Question

Compare and contrast the advantages and disadvantages of using credit​

Answer 1

Explanation:

Advantages

1. Purchasing Power: Credit Cards enable users to make big ticket purchases they might not otherwise be able to afford.
2. Rewards: Many cards offer rewards programs that will accrue points, discounts, or other benefits like frequent flyer miles.
3. Convenience: Credit cards reduce the need to carry cash. Most retailers accept credit cards and they are pretty much required for online purchases.

Disadvantages

1. Overspending: Credit cards can make life easier, but they can also make overspending easier as well. With a credit card, you’re spending money you don’t necessarily have yet. If you’re not careful, this can quickly lead to unexpected debt.
2. Interest and fees: Using credit is essentially borrowing. And you’re not borrowing for free. Mismanaging a credit card can lead not only to a high balance, or maxed-out card, but also to debt in the form of interest and fees.
3. Fraud: Credit cards (and other electronic forms of payment) carry unique dangers. Credit cards can be stolen, their numbers can be copied, and they can be used to steal your money and identity.

Answer 2

Answer:

Advantages:

⇒ Easy to carry around, almost anywhere.

⇒ Spending is more efficient, and managing money flow.

Disadvantages:

⇒ Can be lost easily if not took care of.

⇒ Overspending can be a cause, because of spending big amounts of money.

⇒ Fraud.