Do we really need credit cards? Are there reasons for using credit cards? Of course, they’re good. Practically, everyone from retirees to teenagers, own at least one credit card. In fact, a credit card tends to be a necessity these days. You’ll find advertisements everywhere about the importance of using credit cards. You can see them in televisions, newspapers, radios amongst others. Also, you’ll receive many direct mailers from many credit card institutions.
Despite many people having credit cards, some of them don’t know what they are. The credit card is generally a financial arrangement between the card user, or you and an institution. In most cases, these institutions are banks and SACCOs, from who you can request or borrow instant money and promise to repay later. For example, many Americans do love credit cards thus making it the preferred method of payment in the United States. There are many benefits that are associated with the use of credit cards. In this article, we’ve rounded up the reasons why you should use a credit card.
Emergency Source of Funds
Here, we’re talking about the real emergency. In our daily lives, real emergency funds are always the best. However, not everyone has $2000 cash to make car repairs, buy emergency airline tickets and deal with natural disasters like hospital bills. In my opinion, paying 15 percent interest is a wise decision than drawing out payday loans during an emergency. Remember that some payday loans have near 1000% interest rates if left for a whole year.
As said, having an emergency fund in cash in your saving account is an excellent idea. Nonetheless, if you don’t have, a credit card can be among the best ways that can help you to pay your bills. If you need an emergency pop up, a credit card will rescue you. It will provide your family with the cash they need.
I know you like a convenient method of payment. In one point, you may have insufficient ready cash in hand, however, you can purchase products or services simply by using your credit card. Carrying a huge amount of notes can be boring and uncomfortable considering that you must have a good pocket or a bag. With a credit card, it is enjoyable because there is no need for carrying a lot of cash around. For example, some online-based stores and shops like Amazon and Walmart mainly accept payment via credit cards. With this, having cash may not be suitable in such cases.
Security and Protection
Can you imagine losing your wallet full of dollars? The chances are that you’ll never find that money again. You may get the wallet back, but with no cash inside. However, if you lose or misplace your credit card, you don’t have to worry provided you’re the only person who knows your pin number. All you need is to report the case to your company. They’ll stop the card from transacting by canceling it, where you’ll get a new card within few days. Therefore, avoid screaming your pin number all around. If your company finds evidence that you were negligent, then they won’t pay you even a single cent.
My husband and I made $700 from our credit card signup bonuses last year. We had to seriously spend a certain amount in order to qualify, thus we used a credit card for our normal purchase but we finally hit the mark. We got a huge bonus. Nowadays, many supermarkets will advise you to own a card. Basically, they’ll provide you with one. After every purchase, you’ll get points until you reach their mark. Eventually, you can redeem these points and claim for a bonus from them. Also, this raises your credit score and builds a credit history. Get a credit card and enjoy rewards such as discounts, rebates, voucher cash back and gift cards. A good example is Bank of America that offers rewards.
Having been robbed in Spain, and having once lost ten 20 dollar bills on an Italian dance and music floor, I now carry with me little cash whenever I’m traveling. One thing is that cash makes you a senior target for criminals. If they rob your money, you’ll never see them or your cash again. However, if your credit card is stolen or lost, you’ll be liable for 50 dollars at most. Remember that this will depend on whether you’ll report or not within given days. On the contrary, some credit cards offer zero liability. Nobody will like to run around unfamiliar streets looking for shops to trade in these dollars. All in all, credit cards are safer in many places.
This is not a bad feature! Many credit card institutions provide extended warranties on products you buy with their card. It is always advisable to get the right card and use it to buy appliances, electronics and other items that have short warranty periods. According to WiseBread, keep the original receipts well because you’ll use it to file a claim when needed.
Most of these cards automatically offer a plethora of consumer protections. Surprisingly, most people have never realized they’ve free insurances. Some of these include travel insurance, rental car insurance, and product warranties. This means that if you buy an item and fails to satisfy you, stolen or broken, you’ll enjoy money-back guarantee.
In the United States, certain purchases are hard to make without a credit card. You may have a debit card, but this not enough to convince them. If you decide to visit during the summer, you’ll be required to rent a hotel room or a car. Having a credit card will make your work easier and simple. Hotels and rental car companies want clients to pay using their credit cards.
To sum up, credit cards have become a convenient and useful tool in human life. This is because of many reasons as discussed above. Whether you want to rent a car or hotel room, enjoy free insurance, convenience, extended warranties, security among others, a credit card is a catalyst. However, it should be used responsibly. Don’t hesitate to know more about credit cards, just take a look at this guide and get to understand.