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People have said a lot of bad things about credit cards, but they actually offer two big benifits:
1. They let you borrow money without paying interest. Yes, the interest rates are obscene, but you don't start paying them until the grace period is over. If you pay of your cards every month its like a free month long loan.
2. If you're smart, you'll get one that gives cashback, usually in the neighborhood of 2%. Not much, but it ads up, especially if you pay for everything with your credit card. Given all the thought given on this and other forums to squeezing a few extra percent out of investments, getting 2% back on everything you spend is a pretty big deal.
3. It helps build credit, which will save you a lot of money in future interest payments when you buy a house.
Now of course, all of these benifits are nothing compared to the obscene interest you'll pay if you don't pay your card off every month, so if youknow you can't handle the plastic, stick to cash. But if you are responsible enough to use a credit card and still live within your means, the smartest financial advice is to pay for everything with your card.
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