Do you need a credit card?

Core Insights - Credit cards offer various benefits such as rewards, security, and convenience, but they also pose risks of high-interest debt if not managed properly [1][3]. Group 1: Advantages of Credit Cards - Credit cards can provide rewards in the form of cash back, points, or miles, along with additional benefits like travel credits and discounts [7]. - They help in building credit scores, as timely payments and responsible usage can improve credit ratings over time [7]. - Most credit cards offer fraud protection, ensuring zero liability for unauthorized charges and additional protections like extended warranties and travel insurance [7]. Group 2: Disadvantages of Credit Cards - High-interest rates, averaging above 20%, can lead to significant debt if balances are not paid off in full [7]. - Additional costs include annual fees, balance transfer fees, and late fees, which can accumulate based on card usage [8]. - Credit cards may encourage overspending, making them unsuitable for individuals who struggle with budgeting [8]. Group 3: Starter Credit Cards - The Capital One Quicksilver Secured Cash Rewards Credit Card requires a minimum security deposit of $200 and offers 1.5% cash back on purchases, with potential upgrades to unsecured cards [11]. - The Capital One Platinum Credit Card does not require a security deposit and helps build credit through timely payments, with no annual fee [12]. - The OpenSky Secured Visa Credit Card requires a refundable deposit and offers cash-back rewards through partner retailers, but has a $35 annual fee [14].