Uncontrolled spending using a credit card is often cited as the main reason why many people get drowned in debt. However, if you are a disciplined person and confident of being able to use your credit card responsibly. You will be better off in many ways by using your credit card to the maximum. A quick look at why using your credit card instead of cash can be advantageous:
Handsome Joining Bonuses
The credit card industry is intensely competitive, and card issuers try to attract new customers in many ways, including offering initial bonuses. If you have good credit, you can easily get a credit card offer with $150. Or even more as a joining bonus, subject to spending a specified amount in a period. You can also qualify for extra reward points, special merchandise, zero-interest offers, gift cards, and more that can make the credit card an attractive proposition.
Reward Points
Most credit cards award one or more points for every dollar charged to the credit card by a customer. Once you accumulate a certain number of reward points, you can redeem them in restaurants, retail stores, or against merchandise available on the card issuer’s website. The secret to finding a good credit card is to match their rewards program to your spending patterns. For example, if you are a frequent traveler, choosing a card co-branded with a hotel chain can work to your advantage. Likewise, a home depot credit card may work to your advantage if you are a frequent shopper at Home Depot stores.
Lucrative Cash Back
Pioneered by Discover, cashback is now common to almost all credit cards. Whenever cardholders use their credit cards in certain specified transactions. They qualify to get cashback, usually equivalent to 1% of the transaction amount. Some card issuers may be more aggressive and offer more on select purchases. However, the qualifying amounts could be typically higher, and often there is a maximum limit of the cashback you can earn in a statement cycle. According to a Forbes article, a credit card without any joining or annual fee and a good cash back program should be your first credit card.
Enhanced Safety
If a debit card is stolen and used by a thief, there’s nothing you can do because the money is gone immediately. If you are not aware of the theft, your scheduled payments or even the checks you have already put in the mail can bounce. It leads not only to embarrassment but also to loss of credit. Credit cards are safer because even if it’s used fraudulently, all you need is to notify your card company and let them resolve the matter. Large credit card networks like Visa and MasterCard secure your credit card against unauthorized usage with zero liability coverage.
Conclusion
Credit cards have numerous advantages as explained above. Additionally, making the most extensive use of credit cards. It is also recommended for the extra time you get to make the payment. Examining the list of features of your credit card will usually reveal many more hidden perks like car rental insurance, travel insurance, etc.
