Friday Jul 01, 2022

Credit cards are essential for financial security.

Credit cards offer many benefits, provided you can responsibly use them. Credit cards offer convenience, protection, and rewards.

Why should you use credit cards? While credit cards may be easier to manage your budget, other payment options such as debit cards or cash might seem more appealing. Credit cards encourage cardholders to spend money that they don’t own, especially when they receive tempting offers in the mail.

We believe a credit card is essential. Credit cards are great for financial security if they are used responsibly. Cardholders with smart credit cards can make money by simply using their card.

They create a credit history.

Credit scores based on financial activity records will be essential if you are looking to borrow money. These scores are partly based on your credit card history.

Credit card use is reported to bureaus that track scores, unlike debit card use. Your score will improve if you have a track record of paying your credit card bills on time. Your credit score will improve even further if you use credit cards.

You may be eligible for sign-on bonuses.

Many cards come with welcome gifts. You will need to spend a certain amount of money (sometimes within a specific period) to get the bonus. Please read all the fine print. It’s an important perk.

The Chase Sapphire Preferred(r) card offers a promotion that gives you 60,000 bonus points for spending $4,000 within the first three months of account opening.

They pay cash back

You earn a small amount back when you purchase cash back credit cards. You can get a cash reward of anywhere from 1 to 6 per cent of your total purchase. These rewards can add up over time to a substantial bonus.

They offer reward programs.

There are nearly as many reward programs as cards. Choosing a rewards program that matches your spending habits or works with a retailer you like is important.

They keep track of your spending.

Do you want to better budget? You can track your expenses with credit card statements. All your purchases are recorded online, including all details such as where, when, how much and how often. Card companies may keep your spending records for many years.

This is especially helpful when it comes to tax time. You can save time and effort when you have a record of your past year’s expenses. Credit card statements can show you business expenses, rental property expenses and tax returns.

They guard against fraud.

Credit cards have greater fraud protection than debit cards. The Chase Freedom Flex(sm) protects your account by monitoring real-time for any signs of fraud.

Your credit card is taken, or your card information is found online. You won’t lose much even if the thief makes purchases immediately on your credit card. Credit card charges aren’t withdrawn instantly.

Once you have reported the theft to the card company, they will place a hold on the card and conduct an investigation. Any fraudulent purchases made between the theft and notification are not your responsibility. Credit card holders have federal law protections that protect them from losing large amounts of cash. You are only liable for up to $50. You won’t be held responsible if you don’t report the purchase or your credit card company has zero liability fraud policies.

Let’s say that your debit card was stolen. Any money used to purchase items fraudulently will be lost as debit card funds are immediately deducted. As a result, automatic payments that you have scheduled could be cancelled. The transactions can be reversed and money restored if reported within 60 days. This takes time and can be more disruptive than a credit-card theft.

These allow you to transfer your balance.

You can move your debts from one credit card to another with a balance transfer. You can also transfer other debts such as car loans or monthly instalment payments to a balance transfer credit card.

Of course, you’ll still need to pay the debt. You can save money by switching the debt to a lower interest rate card. You can also consolidate your debt with balance transfers, which will make your life much easier.

They are included with purchase protection.

Many credit cards offer consumer protection as a major perk. You can return an item purchased with a credit line and have the charges removed if it is damaged or of poor quality.

Credit cards may offer extended warranties for electronics, furniture and other items you plan to use for a very long time. The card often doubles the warranty period. Keep your receipts!

They include grace periods.

Credit cards provide a 30-day zero-interest loan. Credit cards are not like debit cards in that you don’t have to have funds immediately for purchases. You have a grace period to make payment arrangements. Make sure to use this grace period. Credit cards work best if you pay as much each month as possible.

They add insurance

Take a look at the protections that your credit card offers for consumers. You might be surprised at the benefits you don’t know you have. Many cards provide extended warranties, purchase protection, return protection, and rental car insurance.

They are universally accepted.

Your credit card is your best friend while you travel. It is much easier to rent a car or housing with credit than debit. When you rent a car, rental companies generally put a hold on your credit card of about a hundred dollars. With a debit card, this hold can be annoying.

Internationally, credit cards are more widely accepted than debit cards. Consider using your credit card to get lower exchange rates when travelling abroad. This is an alternative to paying high cash rates at airports.

They charge less

Credit cards do not have the overdraft fees or individual transaction fees that debit cards have. Although credit cards might have an annual fee, the rewards you get and the cashback they earn may cancel these out. Chase Freedom Flex(sm) is the clear winner. There’s no annual charge.

Smart credit card usage can help you save money, protect your money, and give you some perks. A single spending method can yield a good rate of return.

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