Owning a credit card is a convenient way to improve your finances. It means having an extra amount of money in your account that you can use anytime and in times of needs. However, that’s not only that; you can get a lot of value from using a credit card. There are a lot of perks that are waiting for you. You can visit some sites and read some valuable tips from other credit card users now. Here are some short previews for you:
Travel credit cards offer various types of coverage. For instance, the Chase Sapphire Reserve offers a fairly comprehensive package, including trip accident insurance, rental car insurance, lost or delayed luggage insurance, trip cancellation or delay insurance, and even emergency medical and dental insurance.
Meanwhile, some cards, like the U.S. Bank Visa Platinum, offer cell phone damage protection.
In many cases, if you want to take advantage of insurance perks, you have to be aware they’re offered. U.S. Bank will only cover your broken iPhone screen if you use their card to pay your phone bill. And a rental car salesman working for commission and trying to get you to buy a policy through him may not mention the fact that your credit card actually already offers a damage waiver when he’s warning you about the recent hail storms in the area.
2. Earning Points
With most cards, you’ll earn at least one point for every dollar spent. But some rewards credit cards offer a higher rate of points for specific categories or merchants. Many cards entice new customers with sign-up bonuses, which can offer larger earnings after you spend a certain amount of money.
Paying with a credit card makes it easier to avoid losses from fraud. When a thief uses your debit card, the money goes missing from your account instantly. Legitimate expenses for which you’ve scheduled online payments or mailed checks may bounce, triggering insufficient funds fees and making your creditors unhappy. Even if not your fault, these late or missed payments can also lower your credit score. It can take a while for the fraudulent transactions to be reversed and the money restored to your account while the bank investigates.
By contrast, when your credit card is used fraudulently, you aren’t out any money – you just notify your credit card company of the fraud and don’t pay for the transactions you didn’t make while the credit card company resolves the matter.
4. Business Credit
New businesses and entrepreneurs looking to embark on a new business venture often find capital hard to come by. For small businesses, credit cards represent an important financial lifeline when traditional funding sources, such as small-business loans, aren’t available. Credit cards help businesses financially, and they also have a positive impact on small-business growth.
This is because some major car rental companies and hotels require a hold on a credit or debit card to reserve a vehicle or book a room. This procedure can take several days or longer. During this time, the amount of the hold on either a credit or debit card is not available to use. Because you may not have the necessary funds in your bank account, credit cards increase your purchasing power, providing you with the required funds at the time they are needed.
6. Emergency source of funds
I mean for a real emergency. A real emergency fund is always best, but not everyone has $1000 cash to buy emergency airline tickets, make car repairs, deal with a natural disaster, etc. And in my opinion, paying 15% interest is much better than taking out a payday loan in an emergency. Some payday loans have interest rates near 1000% if left for an entire year.
7. Frequent Flyer miles
If your lifestyle is one that involves a lot of travel and time spent in airport lounges, then a Frequent Flyer credit card might be the right option for you.
These cards are very similar to rewards cards in that you earn points by making purchases, but they are made with the purpose of spending said points on flights, lounges and concierge services. You can also spend points to upgrade your existing economy seat to business and first class.
However, if you like spending points on things like gift cards and everyday stuff, then a Frequent Flyer card probably isn’t right for you, as the rates for these purchases tend to be comparatively poor.
8. Automatic warranty doubling.
Most cards extend the warranty on your purchases. So if you buy an iPod and it breaks after Apple’s warranty expires, your credit card will still cover it up to an additional year. This is true for nearly every credit card for nearly every purchase, automatically.
9. Buying now to pay later
It can also be a more convenient option to use a credit card, as it can let you buy a product or service but not pay for it until payday rolls around and you can make your monthly repayment
10. Low ongoing interest rates
Generally non-rewards credit cards have lower interest rates than rewards credit cards. It’s not uncommon to find non-rewards credit cards with purchase APR rates as low as about 12-16 percent; however, some non-rewards cards offer exceptionally low rates. Consider the PenFed Promise Visa® Card (11.74% to 17.99% Subject to credit approval.* Your APR will vary with the market based on the Prime Rate.) or the Simmons Visa’s 10.50% variable rate. If you know you may need to carry a balance at some point, having a card that offers a low ongoing rate could be a huge benefit to you, saving you hundreds of dollars in interest costs.