Is it Ideal to buy everything on credit card?

  I believe that there is a credit card for everyone whether shopping at a restaurant, traveling anything that requires payments, there's a credit card for everyone. The plastic or metal card can purchase anything from a coffee to a car and over 80% of Americans owns at least one credit card. The credit card are meant to save you money, they can be really useful at times and at the same time they could be dangerous.

How credit card works

Anytime you pay for something using your credit card, it actually means you're borrowing money from the credit card issuer to cover the fee of the purchase which is absolutely not free, you have to pay the money back in full at the end of the month or over a given period of time with interest. 

So if you're in a situation where you can't pay the money back in full at the end of the day then you shouldn't consider getting a credit card at all. Credit card interest can be 20% on a balance that has accumulated over the month and when you're unable to pay, then the interest keeps rising and it's continuously digging a big hole that will be hard to get out from.

Credit card requires approval. Once you're able to get your credit card approved, the bank automatically give you a maximum amount of money you can borrow which is also known as the "credit limit" and this depends on different factors which includes your income, how much credit you have on another card, debts etc. Whether or not you get approved it all boils down to your credit score and you can't have your credit score without a credit report.

To build your credit history, all you have to do is simply get a credit card, use your credit card all the time and pay it on time and you'll be able to achieve a higher credit score (ranges from 300 to 850). Credit score also help to determine your interest rates on loans or mortgages and does help insurance companies, landlords, employers, etc to determine your trustworthiness.

They are tons of companies in the US that offers credit cards like the Capital One, American Express, Discover, Bank of America, Citi, West Fargo, etc. And we also have the networks which are the companies that ensures the smooth transaction between the merchant and the card issuers which are Visa, Mastercard, Discover and American Express (with American Express and Discover also a card issuer).

Rewards

Your reward is based on your spending habits and to get the most out of your credit card you need to get the credit card that meets your spending habits, like say you spend more on groceries, then get a credit card that help you can 5% or 6% cash back. Rewards on credit card that get most people are often travel related expenses (Airport Lounges, Rental Car, Hotels).

Note: Only use a credit card if you can use it responsibly 

Is it better to buy everything on credit card?

Yes! If you pay credit card fees in full every month, then I think you should use your credit card for and everything you purchase because the rewards system is great and it really adds up over the time.

One of the biggest error noticed on credit card are those who are using them incorrectly and These individuals are either from the lower income households and are uneducated about credit card because no one is lecturing them about money.

For instance when you have a credit card with a $10,000 limit on it, spend as low as 30% on that card to improve your credibility, spending up to $9,000 on a $10,000 credit limit will lower your credit score because your credit to debt ratio is not good. So having a second or multiple credit card which give you a little bit of advantages of more credit limit.

For business owners it is recommended to have two to three credit card, one for all primary expenses while the second will be a backup credit card and the third will be for business expenses only.

Most people are scared of money which shouldn't be. If you know the facts of the concept of how money works, it can serve as an empowerment for you.

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