by Joseph Kenny | 01/27/09

Credit cards have been a great source of convenience for consumers for decades now. Unfortunately, the convenience they provide can come with a price. More households have high credit card debt than ever before, and this is due to numerous factors, the biggest of which is the ease at which a person can spend money he or she doesn't have by using plastic. Interest rates and penalties shouldn't be discounted however, and towards that end, consumers with low credit can expect less-than-stellar credit card deals.

Bad credit can affect a person in a lot of ways. Getting loans becomes more difficult, and those loans that are available have very high interest rates. Likewise, credit cards follow the same logic. If someone has a low credit score, they're looking at getting credit cards with high interest rates and bigger penalties for late payments and swollen balances.

This is true even for those who already possess cards. If someone has a card with a flexible interest rate, his or her card company can raise the interest, causing the consumer to have to pay more for every purchase. Obviously, this is not ideal, so keeping a good credit score is essential to keep interest rates down and expenses at a minimum.

Credit cards present the miserable potential of a downward spiral. Conversely, they also allow a person to significantly improve their credit and get out of a financial slump. Abusing a credit card harms credit, and with lower credit comes inflated interest rates and spending limitations.

On the other hand, if a consumer spends wisely and pays their balances fully and on time, that person will slowly raise his or her credit score over time. This can open up opportunities for lower interest rates and more financial options in general. Basically, the higher a credit score is, the more opportunities exist for paying less and having more financing choices in life.