Smart credit
Everyone will need credit one day to make an important purchase in their life, whether it be a house, a car or even to start their own business. That’s why it’s important to build a good credit file for the future.
In the best of worlds, people would use their credit card only to build credit and to benefit from the different promotions that these cards offer them, such as credit cards with rewards or air mile plans. In reality, credit card lenders will charge you interest when you do not pay your complete balance 21 days following your purchase (the due date usually used).
Borrowing only with the goal of investing: this is another way to use credit in a smart way. When you borrow for a house, for example, it gains in value and easily absorbs the interest rate you are paying to your financial institution. However, if you borrow to buy a large-screen plasma TV…. well, this will only be worth a fraction of the price you paid a few years later, unlike the house.