A credit card not only allows you to perform cashless transactions but also protects you from customer fraud. There are plenty of reasons why paying with a credit card is better than a debit card, or cash, or direct bank transfer.
However, along with the benefits, there are also some traps that you be aware of. By knowing how to use the credit card diligently, you can save a ton of money and also keep your assets safe. So, how do I save money with credit cards?
When you purchase a credit card, you make an agreement with the issuer to pay the debt before the due date of each month. Failing to do so allows the issuer to charge interest. Just doing this will save you hundreds of dollars each year.
Here Are the 4 Tricks to Save Money With Credit Cards
1) Make the Best of Sign-Up Bonuses
Just because you have a credit card does not mean you cannot apply for a new one. It is completely fine to own more than one credit card. Or you can always transfer your balance from one account to another. Why am I telling you this?
Credit card issuers offer sign-up bonuses worth $200-$400 to new users. All you have to do is spend the minimum amount to qualify for the bonus.
2) Get Your Cashback
Certain credit card companies offer 10-20 percent of your purchases back to you as a reward for buying from stores they are affiliated with. Generally speaking, all credit card companies reward at least 1-2 percent of your purchases back. You don’t get this benefit when you pay via a debit card or cash.
3) Use This Opportunity to Build Credit
Having good credit is absolutely essential when it comes to getting a mortgage approved. That too, on low-interest rates. Furthermore, good credit can also make it easy to rent a condo or a traditional home. Since you already have a credit card, use this opportunity to build credit. Set up automatic monthly payments and do not exceed 20 percent of your monthly credit limit. If you do exceed, make sure to pay the credit card bill well before the due date.
4) Make the Best of Offers From the Issuer
Every credit card company has some unique to offer. Some offer a massive cashback on gas, whereas others are more suited for frequent travelers. Make sure you know what you are getting before applying for a card. If you do not see any offers suited to you, simply revoke the service and find a new one.
According to a report by America’s Debt Help Organization, more than 189 million Americans have credit cards. Each household carries at least $8,398 in credit card debt. It’s true that the nation has recovered from the recession, but most people are still following the lifestyle that the 2008 recession forced them to adopt.