Credit cards can either be helpful for harmful when it comes to credit scores. While having open credit can be beneficial on your credit report, high interest rates and charges can make it difficult to keep up with overwhelming credit card payments. This can lead to further debt and even cause some to file for bankruptcy. Credit cards can be especially harmful to people who already have bad credit, as some credit card companies have ways of enticing those with low credit scores to apply. The companies then charge these applicants annual fees, maintenance fees, processing fees and high interest rates to offset their risk.

These credit cards, known as subprime credit cards, target applicants that have a credit score below 600 with a promise to help rebuilt their credit and get them back on their feet. While people who have a low credit score may be excited to have a credit card to use for expenses, the fees can lead to a financial trap. Subprime credit card agreements may be 70 percent longer when compared to regular credit card applications, making it hard for applicants to fully understand the terms of the agreement in the first place.

Other credit card companies offset the risk by having cardholders pay into the credit card with a deposit, rather than charge fees and high interest. This may be a better route when applying for credit cards. For those who do have credit cards, avoid allowing the balance to sneak up to a point where it is impossible to make monthly payments.