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Business Tips

Is Credit Ever A Good Idea?

With threats of escalating debt and careless spending, many of us grow up knowing that credit in all its forms (e.g. credit cards, items bought on credit, etc.) can be a dangerous game best not played. That said, with credit also determining lender eligibility, etc. as we get older, it’s equally important to consider whether credit could ever be a good thing to consider. 

When you look at the facts, it’s clear to see that the answer is a resounding yes. Of course, this isn’t to say that the risks of credit shouldn’t still be taken into account. BUT, with the very financial futures that credit avoidance aims to protect in the first place in mind, we’re going to look at just three pressing reasons why sensible, well-researched credit might not be such a monetary cookie monster after all.

Improved credit scores


For those of us who have kept our finances squeaky clean and credit-free, a sudden refusal for something like a rental agreement can come as a blow. Unfortunately in the lending world, no credit rating is as bad as a negative credit rating from a risk standpoint.

This alone is the first reason that credit can, in the right circumstances, be a financial plus. Admittedly, escalating debt is going to have the opposite effect, meaning that it’s also essential to take the time to understand your options with the help of companies like Compare Credit, and to develop realistic repayment plans before interest is applied.

But, once you’ve ticked those boxes, credit that sends your credit score into the green can certainly help you on your way.

Investment in the future

While it’s not advisable to use credit on often uncertain investments for things like cryptocurrency, the ability to free up your finances in the moment can provide some investment potential. Equally, items purchased on credit can provide investment pieces when paid in full.

In both instances, this building of assets can strengthen, rather than weaken, the resolve of your financial future, and security overall

Avoiding bankruptcy

empty wallet

In some cases, credit can also be all that stands between us and bankruptcy. Admittedly, if your finances are at this low ebb, credit can be difficult to manage, and options are generally high interest and best avoided in any other circumstance.

That said, with bankruptcy staying on your credit report for up to 7 years, and generally impacting your score for as many as ten years, high interest isn’t such bad news. In fact, if you’re able to stay afloat using credit while you build your actual finances back up to size, you could enjoy a much swifter recovery that doesn’t send out anywhere near the red flags that bankruptcy would to any future financial prospects. 

Final Remarks

Credit can be undeniably risky in all its forms, and whatever you’re using it for, care and research are fundamental to success. That said, with your financial future in mind, it’s just possible that credit can be a good idea at least some of the time! 

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