THE credit is a powerful financial tool, widely used by consumers and businesses to achieve various goals.
Advertisements
However, its improper use can turn an advantageous resource into a budget villain.
Therefore, knowing how to differentiate between these two situations is essential to maintaining financial health and avoiding traps.
Below, we explore the nuances of credit, when it can be an ally and the times when it can compromise your finances.
Credit as an ally: facilities and opportunities
Credit, when used well, allows you to achieve goals and dreams that would be difficult to achieve with your own resources alone.
This is because, whether it is to acquire a durable good, such as a car, invest in education or start a business, credit can accelerate access to opportunities.
Facilitates the acquisition of durable goods:
Financing, such as real estate financing, allows people to acquire assets without having to pay a large amount up front.
This enables families to own their own home while managing their resources over time.
Enables investments in training:
Courses, specializations and training are often financed through student loans, which make it easier to pay over the years.
These investments can result in increased income in the medium and long term, providing a return on the amount financed.
Supports business growth:
For companies, credit acts as a growth driver, enabling the expansion of operations, acquisition of equipment or the development of new products.
Startups and small businesses, in particular, depend on this tool to grow in a competitive market.
A study by the Central Bank (2023) revealed that 62% of Brazilian families resort to credit to purchase durable consumer goods.
This demonstrates the relevant role of credit in carrying out long-term projects.
++The power of research: comparing prices to get the best deals (consultacred.com.br)
When does credit become the villain of the budget?
Despite its advantages, credit can become a financial villain when used uncontrollably, especially in situations of high debt and high interest rates.
In this case, the lack of planning is the main cause of this problem. See the consequences:
High interest rates as enemies of financial stability:
Abusive interest rates on products such as credit cards and overdrafts are responsible for a large part of family debts.
The 2024 Serasa Experian report showed that Brazilians pay, on average, 13% per month in credit card interest, which can quickly turn a small debt into a big financial problem.
Lack of financial planning:
The indiscriminate use of credit for everyday expenses, such as grocery shopping, can create a snowball effect.
Without a careful analysis of the budget, many end up committing a large part of their monthly income to paying debts.
Excessive debt:
The accumulation of debts can lead to over-indebtedness, in which the person is unable to meet their basic obligations due to the installments of financing and loans.
In these cases, it is essential to seek renegotiation with financial institutions to avoid even greater problems, such as having your name blacklisted.
The following table illustrates the effects of different interest rates on the total amount paid on a R$10,000 loan:
| Credit Type | Annual Interest Rate (%) | Total Amount Paid in 24 Months (R$) |
| Real Estate Financing | 8% | 10.869,00 |
| Personal Credit | 20% | 12.197,00 |
| Credit Card Installments | 150% | 29.823,00 |
| Special Check | 300% | 62.732,00 |
Source: Central Bank of Brazil (2023)
The table shows how interest rates impact the final amount paid.
This is because, while real estate financing has lower interest rates, products such as overdrafts can multiply the debt, making credit disadvantageous.
How to use credit consciously?
The conscious use of credit requires good planning and knowledge of the conditions offered by financial institutions.
That said, with some care, it is possible to enjoy its benefits without compromising your financial health. Here are some recommendations:
Plan before signing contracts:
Assessing the impact of the installments on the monthly budget is crucial. Experts recommend that the commitment of income to financing does not exceed 30% of the total.
Compare interest rates:
Before taking out a loan or financing, comparing different institutions can result in significant savings.
Digital banks, for example, tend to offer lower rates compared to traditional banks.
Prioritize paying off expensive debts:
In the case of multiple debts, it is essential to prioritize the payment of those with the highest interest rates, such as credit card debt. This prevents the debt from growing out of control.
As the financial educator highlights Gustavo Cerbasi: “Credit can be a leverage tool for your dreams, but without planning, it becomes a burden.”
The relationship between credit and financial education
Lack of financial education is one of the main factors contributing to the misuse of credit.
This is because many Brazilians are not informed about the importance of planning and understanding interest rates and payment conditions before taking out a loan.
Importance of financial education:
Including financial education from school onwards can prepare people to make more informed decisions.
This is because this type of training helps you understand how debts work and what the risks are of poorly used credit.
Bank and fintech initiatives:
Some financial institutions have invested in financial guidance programs.
Digital banks, for example, offer credit simulators and educational content on their platforms.
Access to updated information:
Searching for information about credit from reliable sources helps you choose the best financial product.
The Central Bank, for example, provides data on interest rates and institutional rankings.
Raising awareness about the use of credit allows consumers to make choices that are more in line with their financial reality, avoiding pitfalls and ensuring that it is a facilitator, and not a source of problems.
The future: digitalization and new opportunities
Digitalization has transformed the market, making it more accessible and faster.
With the growth of fintechs and digital banks, new opportunities arise for those seeking better conditions for loans and financing.
Digital credit and fintechs:
Fintechs offer agility in the credit granting process, in addition to more competitive rates compared to traditional banks.
Therefore, this new scenario has especially benefited small entrepreneurs.
Open Banking and Personalization:
The implementation of Open Banking in Brazil enables more personalized options, with real-time data analysis.
This allows financial institutions to better understand their customers’ profiles, offering more suitable products.
Sustainability in credit:
Increasingly, consumers are looking for lines of credit that consider environmental and social impacts.
Therefore, banks are developing financial products with differentiated rates for those who invest in sustainable projects.
This new market dynamic offers interesting opportunities, but requires consumers to pay extra attention to avoid unnecessary debt and maintain financial health.
Conclusion: Credit and its role in the personal budget
Credit, when used well, can be a great ally in realizing dreams and developing businesses.
However, you need to be aware of its conditions and the impacts on your budget.
Therefore, understanding when it is a tool and when it becomes a burden is essential to avoid long-term financial problems.
With good planning and a conscious approach, it is possible to take advantage of the benefits of credit without compromising your financial health.
As we have seen, financial education and access to reliable information are fundamental in this process, ensuring that the resource is a facilitator for your goals and not a villain that threatens your finances.
Therefore, the key to a healthy relationship with the sport is understanding its nuances and making informed, planned decisions.
This is because only then is it possible to enjoy its advantages, preventing it from becoming a burden on your budget.
Read also: Tailor-made credit: how Open Banking is revolutionizing credit granting (consultacred.com.br).
