Students and young adults should be cautious and avoid owning a credit card, warned Business Day. Credit cards can certainly be useful, but for young people with low incomes they can quickly become an unaffordable drain on the finances.
Understanding the charges that you’ll face when you spend on your credit card is an important place to start so that you can keep any credit card debt in check.
Credit cards should only be used for emergencies. A debit card and a transaction account will offer you easy access to money that you can afford to spend.
You should also be aware that if you pay for things like flights or taxis with a credit card then you may incur a surcharge that increases the price before you’re even hit with the interest.
It’s also important to think about the future of your credit card because the honeymoon period of 0% interest will eventually run out and any debt you incurred will immediately become a burden.
Source: http://www.businessday.com.au/money/super-and-funds/it-pays-to-be-informed-with-credit-cards-20130730-2qvhj.html
