Whether you are buying a gift for someone special, doing a little holiday shopping or just stocking up on staples, the way you pay matters more than you might think. Paying with a credit card can provide you with a host of benefits, including these eight key advantages.
Top 8 Reasons
- On time payments will boost your credit score. Paying off your credit card regularly is a valuable tool for building up your credit score, and doing so repeatedly can help you build a solid credit profile or repair one that needs some help.
- You can get insurance coverage on the things you buy. In addition to their other benefits, many credit cards provide insurance coverage on the purchases you make. This insurance can protect you from theft, damage and other hazards, so you can shop with confidence.
- Your bank account stays protected. When you use your debit card, the money disappears from your bank account right away, and getting it back could be a real issue if the merchant fails to hold up their end of the bargain. Credit cards do not impact your bank account immediately, so your account stays protected.
- Robust fraud protection. If you are worried about hacking and fraudulent purchases, you can worry less when you use your credit card. These pieces of plastic come with robust fraud protection, so you stay protected every time you shop.
- Purchases will be easier to track. If you need help with budgeting, tax receipts and other bookkeeping duties, your credit card company will be glad to pitch in. Unlike cash, credit card purchases are easy to track, and many issuers will even issue you an itemized and categorized yearly statement.
- You will no longer have to carry large quantities of cash. If you lose a wallet full of cash, that money is likely gone forever, but losing a credit card should be far less consequential. As long as you report the loss quickly, you should have zero liability, and your replacement card should be on the way in no time.
- The convenience is hard to beat. It is hard to beat the convenience that comes with credit card payments. Modern technology has made credit card payments as fast as cash, so you can get your goods quickly without holding up the line.
- The perks can really add up. Depending on the credit card you choose, you could earn up to 5% cash back on every dollar you spend, and those bonuses can really add up. From gift cards to airline miles to cold card cash, you can earn extras just for making your everyday purchases.
As you can see, paying for every purchase with a credit card has a number of built-in advantages, but there is also one big drawback. If you are not absolutely certain you will be able to pay off your entire balance at the end of the month, it is best to monitor your spending carefully and put the credit card away when you have reached your pre-determined limit. With credit card interest rates well into the double digits, you do not want to risk your financial future by charging too much on your card.
