5 Great Reasons To Use Your Credit Card

by Kristina on October 13, 2011 · 0 comments

Morning DINKS.  Today we are discussing helpful ways to use our Credit Card.  If misused our Credit Cards can be very harmful to our Financial Lives. If we accumulate hundreds or thousands of dollars in debt and we are unable to make the minimum monthly payments our credit score can be ruined.  If we spend more on our credit cards than we can afford to repay we could find our self making debt repayments for several years.

Having debt doesn’t make us financially irresponsible.  In some cases having debt can be a good thing, such as when it is attached to an asset which consistently increases in value.  Using our credit cards and paying them off can definitely help build and maintain a great credit score as we show that we are financially responsible.  Using our credit card responsibly can also help us get to the next pay check if some months we find our cash flow a little bit short.

According to MSN Money there are certain situations when we should always use our credit card for purchases.

Here are 5 Great Reasons To Use Our Credit Card:

  1. Purchase Protection.  Our credit cards offer protection on all of our purchases.  If our product is defective we can withhold payments on our credit card until we work out the replacement details with the merchant.
  2. Extended Warranties. Buying big ticket items on our credit card such as a television or a computer can be very helpful because many credit cards offer an extended warranty on top of the manufacturer’s warranty.  If we buy a Sony TV and Sony offers us a one year warranty, our credit card may offer another year warranty on top of that.
  3. Categorized Spending.  Some credit card companies break down our spending for us into categories such as entertainment, food, groceries, and pharmacy.  If we see on our statement that we spent over $400 at restaurants in one month, maybe the next month we will think twice about eating out.  This can help us save money on our monthly spending.
  4. Building Our Credit Score.  Having a good credit score can help us get approved for a mortgage or car loan; it can also help us get a better premium on home, auto, and life insurance.
  5. Cash Back and Rewards Points.  Earning Cash Back and Rewards points should be a bonus feature when we use our credit cards for other reasons.  Earning Cash Back and Rewards Points should not be an incentive to or a reason why we use our credit cards and choose to get into debt.

Why do you use your credit card?

(Photo by Jnissa)



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