How Using Credit Can Hurt

While many people use credit wisely, the convenience of credit can sometimes lead to big trouble.

One downside of credit cards is that many people tend to spend more when they use credit than when they pay with cash. If that’s true for you, it can be hard to pay your bill on time, let alone in full. Over time, interest and late fees add up, making everything you buy on credit even more expensive.

There’s a downside to loans as well. Even if you borrow to pay for something that can benefit you—like a student loan or a car that gets you to work—you can get in over your head. That’s why it’s important to be honest with yourself about how much you can afford to borrow. Keep in mind that the amount you can afford to borrow is defined by the amount you can realistically afford to repay—not what the lender will allow you to borrow.

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