Credit card is a significant topic as far as money management is concerned. It is rather ambiguous as there is just about the same number of people encouraging the use of credit cards as there is the same number of people discouraging the use of them. 

Overcoming temptations to own a credit card for the fabulous welcome gifts requires a lot of effort. Especially, when the promotion season hits. Amidst the promotions, peer pressure, and temptations, how do you know if you need a credit card? 

Let’s find out!

Credit Card: Good or bad? 

With the current cost of living, it is natural to lean towards money-saving attributes. What’s more, the pandemic has taught us to value our jobs and savings as much as possible. 

Contrary to popular belief, a credit card can be used as a money management tool when used mindfully. Ranging from emergency needs to mindful splurges, a credit card can be put to good use. 

Here’s how you can determine whether or not you need a credit card according to your current phase of life. 

Students vs credit cards

Who says students do not need a credit card? In fact, it is the best way and time to teach youngsters to be accountable for their own financial planning. 

Other than paying for telco bills, entertainment expenses, food, and transportation, a credit card offers you rewards. Depending on the type of credit card you sign up for, you get to enjoy discounts and cashback with a student credit card. 

A credit card also helps in tracking your expenses. Using the credit card app, you will receive notifications on your latest and previous expenditures. This way, students will get the first-hand experience in money management. 

For those who are not aware of a student credit card, Singapore banks are offering student credit cards specially tailored for students. As students above 18 years old, you will be eligible to sign up for one. 

You can get yourself a student credit card that comes with a lower minimum spending limit and no annual income required. But remember, it only works in your favor if you spend within your limits and pay your credit card debt on time every month. 

Working adults vs credit cards  

Everyone dreams of financial independence. When you start working, your finances become your responsibility. It is also a period of your life where you start making more financial commitments. 

Having the right type of credit card which can reward you with air miles, cashback or rewards can help you manage your monthly budget more effectively. You can earn as you spend using a credit card. When done carefully and mindfully, this will help to boost your finances in the long run. 

Apart from that, you can also enjoy the benefits of a good credit score when you pay on time and maintain a clean credit record. Later on, a good credit score will come in handy when you are applying for a home loan or car loan. 

Family vs credit cards 

Starting a family is beautiful. However, the joy it brings is often accompanied by additional responsibilities and expenses. 

There can be many occasions in which you can definitely use the extra help that a credit card offers. As a matter of fact, it will be one of the best ways to handle your expenses. When it comes to family, one of the biggest challenges is not knowing when a disaster will strike and require you to come up with large sums of money. Sometimes, it can go beyond the emergency fund. This is where credit cards can help you while you secure your funding. 

You can pay for your emergency using a credit card and then repay the credit card using the funding you managed to source later on. Bear in mind that, you need to pay off your credit card debt in full each month to avoid going into debt. 

It comes down to your spending habits

Regardless of being a student, an employee, or a family member, your need of owning a credit card depends on your spending behaviours and your necessities. 

A credit card is not your only option to being financially smart. That being said, it is one of the best ways to track and manage your expenses. Not to forget that a good credit card user is rewarded with many other privileges that could come in handy.