The wise consumer will take a responsible approach, using common sense, to using credit. Installment and open-ended are two types of credit used for various purposes. The use of credit costs money. Save money by comparing credit costs when borrowing money or shopping for a credit card. Consumers readily purchase items such as cars, furniture, appliances, and clothing, and pay for them while they're in use rather than paying in advance with cash.
Retail stores entice shoppers by offering goods now, but deferring payment for several months.
Unsolicited offers of pre-arranged credit arrive in the mail. A wealth of goods and services can be purchased over the telephone by charging to a credit card. Although consumer credit is easy to get and use, a responsible approach, using common sense, to using credit is necessary to prevent overspending and purchasing of impulse and unnecessary items. Knowledge of basic credit terms is essential to being an informed consumer. Credit is a broad term used to describe any situation where goods, services, or money are received with payment to be made in the future.