Many might think the right financial choices is to NOT use credit cards. In fact, it is quite opposite. Credit cards got their bad reputation because people do not use them the right way. Even though they are called credit cards, they should not be treated as such. They should be used as means of payment, replacing cash, checks, and debit cards. Credit cards should protect you, give you a peace of mind, or even generate income.
Here are top 11 reasons why you should be using your credit cards in your everyday life:
11. Fast and easy form of payment
You do not need to handle cash or enter a pin. Currently, many stores do not even require a signature for charges up to $50.00. And this number is going up.
10. Credit Cards build up your credit ratings
With the use of credit cards, you are charging and paying off thousands of dollars. This way, you are showing that you are a trustworthy customer. (In my lifetime, I owned around sixty credit cards. Some I opened, closed, and reopened. My credit score did not suffer because of that.)
9. Purchase protection
Your purchases are protected against theft or accidental damage for up to 90 days. For example, at this time, MasterCard covers up to $3,000 per purchase and up to 20,000 in one year.
8. Extended warranty programs
Your purchase is covered for 12 months after the date your manufacturer warranty expired. As an example, MasterCard covers up to $500 per service and up to $2,000 per coverage.
7. Travel Protection
When paying for travel with credit cards, you are a buying peace of mind:
a.Travel Cancellation/Interruption Protections
If your trip was cancelled or interrupted by sickness, severe weather, or other covered situations, you are entitled to be reimbursed for nonrefundable portion of your trip. Some cards would pay up to $15000!
b. Trip Delay Reimbursement
If your common carrier travel is delayed more than 12 hours or requires an overnight stay, most credit cards will pay for your lodging and meals during that time.
c. Baggage Delays Insurance
You will be reimbursed for essential purchases like toiletries and clothing.
d. Lost Luggage Reimbursement
If your checked or carry-on bags are damaged or lost by the carrier, you could be reimbursed for up to $3,000.
e. Travel Accident Insurance
When you pay for your air, bus, train or cruise transportation with your card, you are eligible to receive accidental death or dismemberment coverage of up to $500,000.
6. Auto Rental Collision Damage Waiver
This option is available when you charge the entire rental cost to your credit card. It provides reimbursement up to the actual cash value of the vehicle for theft and collision damage for most rental cars in the U.S. and abroad.
5. No foreign transactions fees
Many major credit cards do not charge these fees. Additionally, credit cards use the interbank exchange rate, usually the best rate you can get for currency exchange. These days, credit card are accepted at most part of the world and are the safest method of payment.
4. Charges dispute
If you are not satisfied with your product or service, you can dispute charges. I used it many times and won each time. I really felt that my bank did its best to protect my rights.
3. No-cost loan
If you need to make a big purchase, you can use 0% APR card and pay off you balance usually within a year. These are only small minimum payments and no APR if you pay in full before offer expires.
2. Zero Liability
By law, if your card is stolen or otherwise used without authorization, you are not responsible to pay for these charges. For that reason, banks are closely observing your cards for signs of fraudulent activity. Debit cards do not offer this level of protection.
1. Financial benefits
You can choose cards that suit your spending style and use them towards your financial gain. Every dollar you spend should generate some kind of reward.
For example, if you are planning to buy a new GM car, open GM credit card and get 5% back from each purchase towards your new car. My family used this option twice. Once our discount was $5,000 and second time $3000.
If you are into travel, like I am, numerous options are available for hotels chain credit cards. My favorite in this category is IHG Reward Masters Card.
Airline credit cards are great as well. You can use your miles not only for flights but also hotels and car rentals. Flying with frequent flyer miles also gives you excellent opportunities for extended stopovers. (See how added my 12 hours in Barcelona into my flight to Greece.) With nothing specific in mind, you can simply get your cash back and enjoy it any way you want.
Read more here on how you can travel for free using credit cards.