Credit cards are very tempting to use. It’s as so easy to handover your card and purchases a car or a designer cloth without spending off the cash you have available. According to a nationwide survey by LearnVest and Chase Blueprint, the average respondent had $5,000 in card debt and confessed that that debt was the biggest obstacle standing between her and her financial goals.
But there are still so many people who use their cards responsibly below their means and rarely carry their balance from one month to another. When used this way, a good credit card could be of great benefit such as helping you budget and get you free deals as long as these payments are being made on time. Here is some importance of using a good credit card:
Protecting your accounts
One great feature that comes with using a good credit card is the fact that it keeps an electronic record of your activity. This is important when you keep tabs of your spending to avoid exceeding your budget. It’s also useful when the card is missing or stolen. Good credit cards have more in-built protection cash or checks don’t have. One great way is fraud protection which most cards will not include if the purchase is not made by you. It’s much easier to cancel or freeze your card than it is to cancel your check and change bank account.
Boost your credit score
This score which ranges between 300 and 850 is usually used by lenders to determine how responsible and trustworthy you can handle credit. It doesn’t solely rely on having a card; the score is calculated using six different criteria which are: Percentage of timely payments, Credit card utilization, derogatory marks, Average length of account, total number of accounts and total hard inquires. When you use your cards regularly as well as make full payments and stay within the given limit, you will most likely get a good credit score.
Get Freebies such as points and cash back
If you don’t use the reward which u get off using a good credit card on airline miles, points or cash back, then you are not maximizing the use of your card. Good credit card rewards usually come in form of miles, points or cash back for virtually all of them. For every particular amount you spend, you get some sort of reward such as plane ticket, a night at a hotel or a check. If you are going to spend money using your card, you will always get rewarded.