Credit cards are a fact of life today as much as debit cards and occasionally cash.Payment with plastic is increasingly the choice of consumers and for many; credit cards are treated as a debit card.
Credit cards also have a sinister side to them and that is high interest rates.Not all cards carry a 16 to 20% interest rate, but the vast majority do have these high rates.It is how you as the consumer choose to use them that will save you money.
Look for a card that suits YOUR needs.Do not get a platinum card if a standard card will suffice.Marketers appeal to the consumer’s need for self-importance by trying to convince you that if you have a platinum card you are someone special.You are; to the credit card company who bills you every year on the anniversary of the card for that privilege.Platinum cards are not usually free and if you don’t need the attached benefits, don’t get one.
Rewards cards are only of value if you cash in on them.Travel rewards or purchase rewards etc. can be of great help to the consumer who will actually use them.If you just collect the rewards on the chance you might use them some day, you are paying for that privilege usually in the form of annual fees.
Look for a card that offers you the lowest rate.Most companies offer an introductory rate for a limited period of time.This can be a good thing but read the fine print on the contract.If you transfer a balance, it may not qualify and in fact could be seen as a cash advance that would be charged at an even higher rate than for commercial purchases.Some cards DO offer a low rate balance transfer.Read the fine print.If this is the case then transfer that old balance to the new card and use the interest savings to pay down the principle on the balance owing.
Pay off your cards monthly.Most credit cards have a grace period that does not accumulate interest if you pay off the entire balance within that time.If you make only a partial payment then interest is charged.
Avoid cash advances.Interest begins as soon as you make the charge.
Never throw out your credit card receipts.Keep the receipts and check them against the bill.This will alert you to fraudulent charges.After the bill has been confirmed, shred the receipts unless there is purchase protection applied to your purchases.In this circumstance make sure you file the receipts away in the case you need to make a claim.
If you are going to travel, book your flights and pay for them with your travel rewards card.This will automatically qualify you for the additional benefits that come with the card.Plan your purchases such as hotels and car rentals to use the participating merchants in the travel program.It can save you money as well as accumulate rewards.Also look for the little known benefits such as the use of members only airport lounges.
Be aware of your card.It is more than just a credit card and often provides a host of benefits most consumers don’t know about.These benefits can add up to save you a significant amount of money but only if you need them and use them.