Credit cards 'offer flexibility'

Wednesday 28 October 2009

Article by Mozo

Credit cards can be a flexible way of borrowing money, according to a new report.

Those looking to compare credit cards may be interested to learn that they are particularly suited to people who are disciplined, the Australian asserts.

While personal loans offer rigidity, which can be beneficial to those who cannot trust themselves to make the full repayments in a given period, credit cards can provide an element of freedom, Gillian Bullock, writing for the news provider pointed out.

"If you like flexibility and are disciplined, then credit cards can work," she said.

Ms Bullock advised people considering this option to do their homework and shop around for cheap credit cards, since this is the most important factor.

Looking for less expensive rates is essential, since people may not be able to reap the rewards of loyalty points, interest-free days and other promotions if they are paying back a lump sum over a longer period.

If consumers look into different products adequately, they may find that credit cards are cheaper than personal loans, Ms Bullock concluded.

According to the Reserve Bank of Australia, meanwhile, people are paying off their credit cards faster than they are spending on them, its new report revealed last week.

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