What are the disadvantages of using credit?

Credit is about to make Julian’s life miserable if he doesn’t change his spending habits.

Julian’s mother worked hard to provide for her family but money always seemed tight. When he was very young, Julian promised himself that he would always be able to buy the things he wanted. Now that he’s older, has an income, and has qualified for a credit card, Julian is having a lot of fun buying the things he’s always wanted.

Well, it was fun until Julian got his credit card bill and struggled to pay for it. Nonetheless, Julian still found using a credit card as a way to overcome the deprived feeling he had for so long, and uses credit to buy clothes, music, and movies.

Credit helped Julian get the things he wanted, but he is overspending and has a hard time not using his credit card. Julian is not using credit responsibly and will get himself into credit trouble if he doesn’t change his spending habits.

A summary of reasons to use credit, and reasons not to use it follows!

Advantages and Disadvantages of Using Credit
Advantages of Using Credit	Disadvantages of Using Credit
Convenience: It’s easier and safer to carry a credit card or get a loan rather than carrying around a large amount of cash. Using a credit card allows you to buy items over the Internet.	Interest: Interest is the amount you pay to carry a credit card or loan balance. Interest increases the total cost of items purchased.
Protection: Say you buy an item with a credit card and you have a problem with it. If the store you purchased it from refuses to refund your money, your credit card company may try to get the refund on your behalf.	Overspending: People often use credit to buy things they can’t afford. Sometimes friends or flashy advertising pressure us to buy things we know we shouldn’t.
Emergencies: If your car breaks down and your buddy who usually fixes your car is out of town, you can charge the repairs and get back on the road.	Debt: When you borrow money, you become a debtor. That means you owe a lender money. The lender is legally entitled to full repayment of your debt. If you are unable to pay your debt, lenders can legally claim a portion of your future income. And having too much debt can damage your credit.
Opportunity to Build Good Credit: This means you are building a history of paying money back on time.	Identity Theft: This happens when someone uses your personal information without your permission to commit fraud or crimes. Identity theft occurs when a criminal steals your credit card or gets a hold of your Social Security number.
Quick Gratification: You can buy and use an expensive item, such a car or house, while you’re paying for it.
Special Offers: Credit card companies want you to use their cards. They may make special offers for rewards or low-interest cards.