In this video, we're going to be talking about advantages and disadvantages of using a credit card. If you don't know me, hi, I'm Romina and welcome back to my channel. And now let's jump right into the video talking about the advantages of using a credit card. Advantage number one on my list of using a credit card is that it helps to build your credit score. If you don't know what a credit score is, I made a whole video about credit scores and it's right here. But essentially, your credit score is one of the biggest parts of your financial life. Having a good credit score will help you a lot in applying to mortgages, car financing, and many more loans. So if you want to have a good credit score, make sure you use your credit cards. Advantage number two on my list is that credit cards are way safer to carry around than cash. As we all know, carrying cash is very inconvenient because you have to keep it in the wallet or in your bag. And when you go to the store, you get coins back and you don't even know what to do with those coins after. But with credit cards, you just carry around a tiny card. And when you go to the store, you can just pay with that card for whatever you want. It's also safer to have a credit card because with cash, you can easily lose it forever. But with a credit card, even if you lose it, you can easily call your bank and they will cancel your card for you. Advantage number three on my list of using a credit card is that they give you cash back and have reward programs. Some banks give you from one to four percent of cash back while using the credit card to purchase anything. Also, when you get a new card and spend a certain amount of money in the first three months, the bank will give you a huge bonus. This is definitely not something that you can get from using cash or debit cards. Advantage number four on my list is that credit cards track your spending for you. When you purchase things with cash at the end of the month, you have no idea how much cash you've spent on certain things. But with credit cards, you can actually see the whole history of your transactions. And a lot of banks actually make it so easy for you to see where your money is going by showing you a pie chart in your report. Those pie charts show the percentage of money that you spend on food, entertainment, utilities, and others. So at the end of the month, you can see how much of your money goes into which category and you can budget your money accordingly. Last but not least, Advantage number five is that credit cards are widely accepted, especially in the US. With credit cards, you can literally use them in most stores across the whole US. And you can also shop online, which with cash you can't. So these were the advantages of using a credit card, so now let's jump into disadvantages. This advantage number one on my list of using a credit card is the temptation to overspend compared to cash. When you don't have the tangible money in your hands, you tend to overspend more. When you use cash to purchase something, you feel like you have less money than you had before. But with credit cards, it's easy to swipe and not care about how much money you're spending. And then at the end of the month, when you do have to pay off your credit cards, the realization hits you. So if you think you'll be tempted to overspend with a credit card, then it may not be for you. This advantage number two is that you have to pay your credit cards on time. You always have to pay your credit cards on time because if you forget to do so, you will have to pay extra late fees as well as interest fees. This advantage number three on my list is that you can damage your credit score if you don't use your credit cards correctly. So if you open too many credit cards and you don't pay your credit cards on time and borrow too much money, that reduces your credit score. So make sure to check out my video about credit scores as I give you tips on how to improve it. And the last disadvantage, this advantage number four, is that a lot of credit cards have membership fees that you have to pay each year. A lot of people may benefit from these cards because they have better reward programs. But if you're not using those credit cards enough, they may not be worth it for you. So if you want to sign up with a card that has a membership fee, make sure that the rewards you get will actually be more than the fee that you pay. So these were the advantages and disadvantages of having a credit card. If you liked this video, please give it a like and subscribe to my channel for more videos. Thank you guys so much for watching this video and I'll see you in my next one. Bye!