Most financial experts advise their clients against using their credit cards; this is not without good reasons. A lot of persons often use their credit cards carelessly and irresponsibly that they often end up neck-deep in debt.

But, if you pass the responsibility test and avoid using your cards irresponsibly, you stand to get some benefits. Let us discuss some of the reasons why you should use your credit cards and strategies you can employ to ensure you make the best out of it.

1. Cash Back

Cash-back cards were made popular in the U.S by Discover. The concept behind it is quite simple. When you use this type of card to purchase anything, you get back 1 percent of the money spent on the purchase.

Now this concept has been popularized and grown so much so that some cards offer 2 percent, 3 percent, and even 6 percent cash back for specific purchases.

If the cash-back card offers minimal interest and fees while offering you a high reward rate, then you have landed one of the very best.

2. Frequent-Flyer Miles

This is one of the oldest perks of using credit cards as it can be traced back to the 80s. During this time, American Airlines started offering their customers a means of earning frequent-flyer miles. They didn’t even have to be flying to earn them. They achieved this by partnering with Citibank.

In current times, airlines, both international and domestic offer their customers this service by partnering with well-known credit card businesses.

When you own one of these cards, you earn 1 mile for each dollar spent in a net purchase. Some low-end cards that do not charge an annual fee may offer just 1 mile per 2 dollars spent.

But, your rewards value is based on the airline ticket you choose to buy with your miles or points.

3. Reward Points

Cardholders earn a point or more per dollar spent when they make purchases with their cards. These reward points are often attached to certain product categories like gasoline or groceries.

If you earn points to a given threshold, you can redeem the points for travel or gift cards or even select merchandise products from the card’s company online portal.

The options of redeeming these rewards are nearly endless. If the card company partners with a clothing retailer, hotel chain, or any other organization, you can control your daily spending by patronizing these businesses and earn rewards daily.

You can be very deliberate with this and get a card that will fit your daily spending patterns. If you do the opposite of this (alter your patterns to suit a card), you may find it to be counterproductive. So, if you already spend on a retailer or like a particular hotel, simply use your card to continue your patronage. This way, you will enjoy the perks and discounts attached with being a regular while earning your card’s reward points.

4. Grace Period

If you make a purchase with a debit card, your money goes right that instant. But, with a credit card purchase, you have your money in the checking account till you pay off the card bill.

Having your funds hanging like this can be quite helpful in the following ways. First, money’s time value, no matter how minute can help you save some money. What we mean by that is, when you delay payment, the purchase becomes a little bit cheaper. Aside from that, when your cash remains in your checking bank account even after purchase, you may earn some money during this grace period if your checking account is an interest-bearing one. The extra money will make up a substantial amount at some point.

Furthermore, using this means of payment means you do not have to monitor your account balance too much as if you used other payment means that removes your money immediately.

5. Helps to Keep Vendors Honest

Let’s picture a scenario. Let’s say you need to floor your entryway, so you get a vendor for the job. The tile setter comes in with his team and after some measuring, grouting, cutting, and setting the tiles and spacers, the work is done. All that is left is for everything to set.

The vendor needs to be paid for a work well done, so you sign a check from your bank saving account. 2 days later, the grout is yet to be set and your tiles are beginning to shift. Everywhere is a disaster and your money’s gone.

Your only chance of getting your money back is to take the case to the licensing board. The whole process may take a while, sometimes months, and your money would be with the contractor this whole time.

You can avoid this scenario we just painted by making this kind of payment with your credit card. If you have an issue with the service rendered, you can make complaints to your card’s issuer who can then withhold the money from getting to the scam vendor. But we are sure things wouldn’t even get to this since this payment method discourages vendors from fraudulent behaviors.

6. Provides Safety

Other than protecting you from getting scammed by vendors, this payment method offers you safety from any kind of fraud. If a thief uses your debit card, your money leaves your account immediately. When this happens and you have scheduled payments to be made online, they may bounce back.

The missed or late payment may reduce your credit score. You can check here to learn more about credit scores. When this happens, the bank will need to investigate the fraudulent transaction and the investigation may take a while.

On the other hand, if your credit card was used for the fraudulent transaction, you do not lose any money. You simply need to contact your issuer and report the fraud they will in turn resolve the case.

7. Insurance

A lot of credit cards have several consumer protections the users aren’t even aware of. Some of them include product warranties (this may extend longer than the product’s manufacturer’s warranty), travel insurance, and so on.

8. Help Build Your Credit Score

If you do not have credit or you need to build your credit score, you can achieve this by using your credit cards responsibly. When you use them, the card’s company reports the activities to the credit agency.

In contrast, debit card uses do not appear on the credit reports. Building your score can help you qualify for bigger loans and unsecured cards.

9. Accepted Universally

You may find it difficult to make certain payments with your debit card. On the other hand, some businesses encourage the use of credit cards, like hotel and car rental companies. This is because these businesses can easily charge for the damages done to a car or room if payment is done this way.

Furthermore, unless your stay in the hotel or your rental payment was prepaid, the merchant has no way of knowing how much the transaction will round up to. Therefore, they need to block some amount from your credit line in case of potential charges that were not anticipated. So, the business may want to put a hold on some of the money in your account if youpay with your debit card.

Finally, if you are abroad, you may be unable to use a debit card as it will mostly be declined even though a well-known bank logo is on it.

Times Credit Cards is not the Best Option

Despite all the aforementioned benefits, it is better to not use credit cards in some situations, and this depends on your spending pattern. Some of these situations are:

• If you pay your credit bills late or in part.
• The credit card you can get has a low limit and you can’t stay below the balance.
• You spend way much than you earn

Conclusion

Using credit cards come with a lot of perks some of which we have discussed in this article. However, to enjoy these perks, you have to use your card responsibly.