5 Reasons to Use Your Credit Card for Everything
Were you aware that many experts believe that you are actually better of utilizing a credit card, instead of a debit card in order to make every day purchases? Don’t be confused, it is extremely important that you only make purchases that you can afford to pay back right away, and that you’re able to pay off your credit card bill every month. However, as long as you ensure these things then using a credit card instead of a debit card or cash is recommended. Here are five reasons as to why you should choose your credit card in order to make all of your purchases.
1. Great Fraud Protection
In the case that your credit card is taken and used, federal law will provide you with the biggest overall protection if you are using a credit card. The Federal Trade Commission mandates that you will only be held liable for $50 of fraudulent charges made with credit cards, however most companies won’t even hold you liable for that. Debit cards, on the other hand, are more dangerous when they get into the wrong hands due to the fact that funds can be immediately taken out of your account, and the FTC can hold you reliable for $500 of any stolen amount.
2. Helps You Build Up Your Credit History
Most people know that the more they use their credit card properly by paying off their bill each month, the better their credit rating will be. However, not everyone is aware that this can allow him or her to get a car loan or mortgage with lower interest rates. By using your credit card responsibly, you can work to greatly increase your credit score, which will allow you to gain access to the best interest rates on the market.
3. Avoid Fees
Using your debit card can cause a number of fees to be charged on your account. For instance, you may be charged a hefty overdraft charge if there isn’t enough money on your account to cover your transaction, or you may be subject to a swipe fee for any transaction that you make. On the other hand, there are plenty of credit cards on the market like the Discover card that will offer their customers a 0% APR for the first six months of use, which means that you won’t be charged any interest, even if you’re unable to pay off your bill in full. On top of this, there are many credit cards that don’t have fees in order to use them.
4. Earn Great Rewards
If the reason as to why you avoid credit cards is because you want to avoid falling into debt then you are not benefiting yourself. It is true that staying out of debt is extremely important, however you can still ensure that you do this while still fully utilizing a credit card and maximizing your reward potential. There are many credit cards out there that have amazing rewards like free hotel stays, cash back and free air travel and so using one properly can be a great advantage to you.
5. It’s Great for Spending Reports and Accounting
If you avoid using cash or making any purchases on your debit card, you can ensure that your monthly spending is all bundled into a single report in the form of your credit card statement, which can make things very simple when you’re managing your finances. On top of this, there are many credit cards out there that will help you organize your finances by categorizing your spending habits so that you simply have to glance at your report in order to see where all your money is going.