Plastic money, like a knife, can be used for good and for bad, a financial planner warns fresh graduates.
PETALING JAYA: A financial planner has advised fresh graduates to ensure they are well informed of the risks before acquiring a credit card.
MyFP Services Sdn Bhd founder Robert Foo said many newly employed graduates would use their credit cards to buy the newest gadgets after being influenced by advertisements into thinking that owning them would make them happy.
“The media is very powerful and they promote lifestyles, new items, new phones – all kinds of things that promise happiness,” he said.
“Unfortunately, many fresh graduates buy into these advertisements and end up misusing their credit cards.”
Foo was commenting on Public Bank’s recent launch of credit cards catering to the lifestyle of the young.
Public Bank managing director Tay Ah Lek said the credit cards were for customers with a fast-paced lifestyle and a preference for online shopping.
“The PB Quantum Visa and PB Quantum MasterCard credit cards target a mass market segment with a minimum annual income of RM36,000,” he said.
Foo said his warning did not mean that it was wrong of banks to issue credits cards.
“A credit card is like a knife,” he said. “It can be used for good things and it can be used for bad things. If you’re properly informed and educated and you know the risks involved in having a credit card, and you still misuse it, then there’s no one but yourself to blame.”
He said the proper way of using a credit card was to treat it as a convenient payment utility that took away the risks of carrying too much cash on your person.
“As long as you pay all of your credit card dues at the end of the month, you’re fine. Things only turn ugly when you use the card to live beyond your means and end up incurring too much debt.”