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8 Reasons Why You Should Have a Credit Card

BY Team Loanstreet

Updated 21 May 2024

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*The content and information on this article might be changed or updated periodically by Team Loanstreet without notice.

Almost everyone you know now has a credit card (or two, or more!), so it’s no surprise you’re tempted to jump on the bandwagon. But this begs the question: should you really have one too?

If the following list of reasons why you should get one rings “Now this would help!” in your head as you read, then the answer you’re looking for would be a ‘yes’.


What's covered in this article?

1) Build your credit rating


Looking to build up your credit score but don’t know where to start? Start with a credit card, as it helps you increase your creditworthiness when you pay your bills on time. Keep the transactions to a bare minimum, which is to say that you shouldn’t be swiping for anything that you wouldn’t pay for in cash.

One way to minimise chances of overspending would be to place repetitive payments onto your card, such as your gym membership and postpaid phone plan. This way you’ll have regular transactions while at the same time not creating a strain on your cash flow.

2) Increase purchasing powers

A standard credit card will normally give you a credit limit which is double that of your monthly salary. It helps you to purchase an item which you normally wouldn’t be able to afford. For example, you can purchase certain goods on an installment plan (such as a new television) and not fret about having to save for months before you can get it.

3) Buffer for emergencies

We never know when something untoward will happen. A credit card can save you from an unpleasant situation so that you can avoid the problems that come with an urgent financial situation. Let’s say your car was to break down and leave you stranded; the amount to pay for a tow truck and subsequent vehicle repairs will set you back a few hundred Ringgit.

Even if you can’t use the credit card itself to pay, you can still get a cash advance from it. This is similar to a short-term loan, where you get cash against your credit card, up to a specified amount. All you’d need to do is go to an ATM or bank and use your credit card (not debit card) to withdraw cash.

4) Balance transfers


This is a great way to save you some money. It allows you to transfer your existing debt (with a high interest rate) to your credit card which may actually have a lower interest rate. If you decide to pay off the entire amount before the grace period* ends, you don’t have to pay any interest. On top of that, you could collect points or earn rewards. Now who says you can’t have your cake and eat it?

*A grace period is a period where no interest will be charged on your credit card for purchases and bills. If utilised wisely, that piece of plastic can help you buy some time without being charged for it.

5) Convenience of use

You would only need to bring your card along and swipe it when you use it. There’s no need to get cash from a bank or ATM anymore, in addition to not having to worry about carrying a large sum of money on yourself, which is dangerous in itself. It’s easy to carry around plus you can even use it online and overseas without the hassle of exchanging currencies.

6) Easy payments

A credit card bill will come itemised and detailed with the transactions you’ve made so that you can easily keep track of your expenses for that particular month. All you’d have to do is pay off the outstanding balance with a few simple clicks online. You could also pay all your monthly commitments through auto-debit to save yourself the trouble of paying them one by one every month.

7) Peace of mind

Once your wallet is stolen or has gone missing, the cash you have inside will be gone in the blink of an eye. However, with a credit card, you would just have to call your issuer and let them know it is missing so that it will be immediately cancelled, thus saving you from the headache of having to deal with mysterious things that you didn’t purchase.


8) Signup bonuses

It's no secret that credit card companies like to entice potential customers with the promise of a free gift which you can easily get, just by signing up with them. Most often, these gifts are pretty useful and practical. So why not sign up and receive it? If you find yourself not needing the credit card, a simple phone call to the issuing bank is all it takes to cancel the card. 

So, do you think you should have a credit card? 

To sum it all up, a credit card would make your life easier based on the reasons above. If you are just getting started and want to know which credit card will be great for you, here are a few best credit cards that are recommended to assist your decision.

There are also many reasons why you shouldn’t get a credit card. But that's a story for another time! If you are of the personal opinion that getting one is going to make your life easier and you have control over your spending habits, then sign up for a credit card of your choice.

*The above article is intended for informational purposes only. Loanstreet accepts no responsibility for loss that may arise from reliance on information contained in the articles.




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About the Author

Team Loanstreet

Run by a professional human-sized team, get resourceful tips & guides from our very own library of financial articles that can help improve your financial lifestyle & make a well-informed money decision. We strive to provide you with the best service in helping you to get the most out of that DUIT!


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