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Why you should get a credit card in your early 20s?

credit card in your 20s

If you are in your 20s, and wondering if you should get a credit card or not, read this article to know more.

We are living in times, unlike any other. The advancement of technology and the sheer amount of resources we have at our disposal is something that would’ve been unfathomable by the previous generations. After the dot com boom, and the IT Revolution, all industries changed, and took to adopting online and electronic systems and processes.

With these changing times, people are also changing. Detailed studies are being made on the behaviours and trends adopted by millennials. Millennials are basically people born in 1980s, 1990s or early 2000s. They are also identified as Gen Y or Generation Y. Currently, most millennials are in their 20s. The purchase pattern and consumption behaviour of millennials is rather interesting and something that should be studied by corporations targeting them.

What is a Credit Card?

credit card tab

A credit card is a thin electronic plastic slab, which allows you to make payments for goods and services. Banks lend money to customers, and expect to be repaid the principal amount, in a specified period of time. Along with the principal amount, customers are also required to pay interest on the money borrowed, as well as some additional agreed upon charges.

The card issuer (usually a bank) creates a revolving account and grants a Line of Credit (LOC) to the cardholder, from which the cardholder can borrow money for payment to a merchant or as a cash advance. A large number of businesses allow customers to pay for their goods via a credit card. It is one of the most popular sources of payment in the market right now.

There are many types of credit cards like Corporate Credit Card, Travel Credit Cards, among others.

Why should you get a credit card in your early 20s?

1.Purchasing Power

Using a credit card, increases the borrowing capacity of a person, thereby increasing their purchasing power. This allows people to buy things which they couldn’t afford otherwise.

In your 20s, there will come times when you need to make certain heavier payments, which exceed the amount of your salary. These instances can come at any time. For example- you might need to pay a security deposit on a new house that you rent; or you might need to buy a new high-end laptop to suit your working demands. In cases like these, it becomes extremely important that you have a tool like a credit card, which allows you to borrow funds in the short-term.

2. Rewards

Many cards offer various benefits like reward points and discounts to consumers, when you make certain purchases. This offers an added benefit to the consumer, and motivates them to use the credit card to fund their purchases.

Many banks have tie-ups with various companies. For example, if you shop on Amazon using a specific card, you will get a discount; if you carry an AmEx (American Express) Card, you get to access certain lounges on airports; if you pay using a certain bank’s credit card, you will get a cashback on Swiggy. All of these, are examples of brand collaborations with banks for credit cards. In your 20s, all of these benefits will come in extremely handy to you.


Credit cards are extremely hassle-free. In your 20s, when you already have a lot going for you, carrying around cash to manage your expenses can be tedious. A credit card can be used to make payments at almost all retail stores.

After making a certain purchase, you immediately get a message which briefs you upon how much you have spent, where you have spent, and how much balance is remaining in your account. For the modern-day millennial, this proves to be very useful and convenient. 


The fact that a credit card is electronic and can be tracked by your bank to see where the spending has happened is an extremely important feature in a credit card. When life is so fast in your 20s, it becomes difficult to keep a track of all your expenditures. Thankfully with a credit card though, you are provided with a detailed list of all your expenses.

Further, any hacking or fraudulent activity using your card can be identified, tracked, and stopped. This provides a great deal of financial security to users.


In case of unforeseen or unanticipated expenses, a credit card is your go to. If there is a medical emergency for example, and you don’t have enough savings, to meet the short-term need for funds, a credit card proves to be extremely useful.

6.Credit History

One of the most important tools which affects your credit score or CIBIL score is your credit card. If you don’t default on payments, and pay your bills on time, you can actually improve your credit score. Doing so, will make you eligible to get loans and pay lower interest rates in the future.

Hence, for a young adult or someone in their 20s, a credit card is an extremely lucrative source of funding your payments- and something that you should definitely avail of.

To know about the different available credit cards and compare credit cards, click here.


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