Are you thinking of giving up your credit cards? Don’t. Credit cards are useful financial tools when you know the proper way to use them. Here are ten ways to use your credit cards to your advantage and spend less.
1. Cashless spending: It is much safer than carrying a lot of cash in your purse. It is convenient when you are running short of cash to buy an urgent and essential item.
2. Use your cards instead of cash: Use your credit cards instead of the amount that you have set aside for your monthly spending. You pay less when you use a credit card that gives you a discount for the purchases of your grocery and petrol. At the end of the month, you just issue a cheque from the account where you keep the money for your monthly expenses. You can’t get a discount when you pay in cash.
3. Simplify your life: Let your credit card settle your utility bills, insurance premiums, and other recurring expenses. There is no need to go to many places to pay for all these ongoing payments.
4. Big-ticket item: Get zero interest installment plan for the purchase of a big-ticket item. You can stretch your payment up to 36 monthly installments without incurring interest. However, you have to make sure that you have included the amount in your monthly budget.
5. Free credit: To avoid late payment charges and interest on the outstanding amount, pay the monthly bills fully and promptly. This is the way to enjoy credit free of charge for one month. Where else can you get credit to make purchases without interest and security?
6. Establish your creditworthiness: It is also a great way to establish your creditworthiness when you pay the monthly bills fully and promptly. It is an indication that you can be trusted to obtain credit and you have the means to pay and you do make payments promptly. When you apply for a loan in the future you will be considered favorably.
7. Best for holidays: See the world with peace of mind just by carrying your favorite credit cards. You can withdraw cash in local currency at any ATM for sundry expenses. It is better than travelers' cheques. Credit cards are accepted worldwide, take your cards along for a carefree holiday.
8. Online purchases: Online purchases are made possible with credit cards. It is safe and easy. If the transaction is not in the order you can always dispute it and cancel the order with no charge to your card.
9. Track your spending: Each and every transaction that you have charged to your cards is itemized and listed in the monthly statement. You will know when and where you have spent your money. There is no way to check your spending if you use cash unless you are willing to spend time to record where your money has gone.
10. A budgeting tool: You know precisely your spending pattern from your monthly credit card statements. It is a useful tool to budget and control your future spending.
The most important thing to remember is that you don’t use your credit cards to obtain credit and incur debt. Use your cards like using your own money. Stop charging it when there is no fund available.
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