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Reasons to use a credit card

Posted by on Jan 29, 2016

Reasons to use a credit card

Credit cards are often considered as unfavorable means of payment, since people tend to use them irresponsibly, the own too many of cards and they are unable to keep track of the expenses. However, credit cards have a range of positive features, and when they used responsibly they bring the user a lot of benefits. In this article we will give you some reasons why you should a credit card and why it can be a great financial tool.

First of all, many credit cards often a range of rewards, unlike debit cards which offer no rewards whatsoever, or they are insignificant. If you have good credit rating, with credit cards you can get a signup bonus which goes from $50 to $250, sometimes even more. In addition to the signup bonus, every purchase you make with a credit card brings you a certain amount of points. The points are added up, and when they reach a certain amount, they can be used to obtain discounts in various stores or to get gift cards. A certain amount of points may even bring you free airplane tickets. If you are a frequent flyer and you own a credit card approved by the airline you most frequently use, you add up the miles at the rate of one mile per one dollar spent.

After you have added up enough miles, the price of your next airplane ticket can be significantly reduced, or it can even end up being completely free.

Some credit cards offer cash back. This means that you are entitled to earning back 1-5% of each of the purchases you perform by a credit card. Some cards offer even higher percentage of cash back, but you are obliged to in return invest the cash back directly into the investment account.

Paying with credit card allows you a grace period, which is not the case with debit cards where the money is instantly withdrawn from the account. With credit cards, the money remains on your account even after you make a purchase, and it stays there until the time when the credit card bill needs to be paid.

Advantages of credit cards

When it comes to payment card frauds, it is much easier to avoid them if you use a credit card. If it is used fraudulently, you need to notify the credit card company. Since the money is not withdrawn from the account immediately, the credit card company will have enough time to resolve the matter, and you are not obliged to pay for any transactions you did not make.

Another advantage of credit cards is that they are accepted worldwide, so you do not need to worry when you make purchases in other countries. Additionally, you can use credit cards to book a room or a flight online, or to order any kind of goods online from a store overseas, which expands your purchasing power.

If you use a credit card responsibly, pay the installments on time and keep track of your debt, you are entitled to a range of possibilities which were mentioned above. Additionally, you will be able to raise your credit rating, which you may find useful in various situations. Therefore, as long as you are responsible, using a credit card can be a satisfaction rather than a bother. In a video below you can see 10 reasons why to use your credit card.