credit card advice
Some people believe credit cards are evil inventions that exist purely to land you in lifelong debt.
This may be true for those who lack the willpower or knowledge required to use credit cards wisely, but it’s a shame for the rest of us. When used smartly, credit cards can be very helpful financial tools with advantageous free perks.
Even if you don’t think you need a credit card, you will want one for these free benefits. You can simply pay off your purchases right away and never carry a balance. You will still reap all of these rewards without ever paying fees.
1. Avoid foreign transaction fees when traveling.
When you travel outside of the United States, you will incur what is called a foreign transaction fee if you make a purchase with your debit card.
This means you will pay a small fee of each and every transaction — usually 3 to 5 percent — when you spend in a different currency. When you are vacationing somewhere for a week, this really adds up.
Certain credit cards, including all Capital One cards, offer no foreign transaction fees as a perk. No more paying fees for purchases overseas!
2. Get cash back.
Why not earn some money back from making your everyday purchases?
Apply for a cash back credit card, which gives you a percentage of your purchases right back. You can usually opt to either receive it via check or a balance credit.
Many of these cards have tiered systems, with higher cash back percentages on staples like gas and groceries.
“Use your card wisely to make
these advantages worth it.”
3. Earn free travel.
Frequent flier credit cards allow you to earn free airline miles for every dollar you spend, which can be redeemed for free flights. It’s not too good to be true — I have flown to Ireland and back for free on airline miles!
Some credit cards actually give you enough points for a free domestic flight for simply signing up.
Note that certain credit cards allow you to only gather miles for one airline, while some let you use them for any airline. Make sure to get the latter if you don’t have loyalty to one airline.
There are also hotel credit cards that allow you to earn free stays.
The quickest way to rack up miles is to use your credit card for every purchase (or at least your larger purchases) and pay it off right away.
4. Make a large interest-free purchase.
There’s no need to finance purchases at furniture stores, electronic stores and other retail establishments when you may make a large purchase.
Many credit cards offer long zero percent APR introductory offers, which means you owe no interest on your purchases for a designated time period. For some cards, there is no interest for 12 months — and sometimes even 18 months!
If you’ve been meaning to make a large purchase but need several months to pay it off, you can use a zero percent APR card. Put the purchase on the card and pay off the balance before the interest kicks in.
What are you waiting for? Apply for a rewards credit card now to enjoy free perks. Some reward cards charge annual fees, but many don’t.
Just use your card wisely and pay off your balance as quickly as possible to make these advantages worth it.
Photo source: abcnews.com