Credit Cards Can Be a Good Thing

Credit cards often get a bad rap. They are blamed for all the financial evils in the world it seems. If a person is deep into debt then the first order of business is usually to cut up the credit cards! While I agree that the misuse of credit cards is quite rampant, that doesn’t mean that they don’t serve a useful financial purpose. If used properly a credit card can be an extremely useful tool for financial gain. Unfortunately, with all the bad press out there, millennials don’t understand their credit card options available to them and how they can benefit.

Reward Points

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While I highly advocate for using credit cards as often as you possibly can, I don’t advise that you carry a balance or pay any interest on them. The interest is icing on the cake for credit card companies, they make their money no matter what on the transaction fees from the merchant every time they accept a credit card payment. In order to entice financially responsible people to use credit cards they off them reward points for each purchase. These reward points can be used in the form of cash, gift cards, or travel vouchers for your next vacation! The competition has been heating up and credit card companies are constantly trying to woo consumers towards their brand. You can easily go online and find credit cards that offering up to 100,000 reward points for signing up with them. At an average of one cent per point that can be worth $1,000 just for signing up and making the necessary minimum purchases required.

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Purchase Protection

Purchase protection is probably the most important benefit of having and using a credit card. Most people don’t consider the protection they receive with these cards. There are consumer laws in place that allow a buyer to dispute any charges on their cards, and the onus is on the merchant to prove that they provided the goods or fulfilled the services promised. For example, perhaps a cleaning service comes in to tidy up your home but they did a poor job. You can typically go online and issue a dispute, provided it’s within a reasonable time period, and they will have to prove why you are wrong. Often times the credit card company sides with the consumer. It gives additional peace of mind that you simply can’t get when paying with cash or a check.

Extended Warranties

Have you every been to Best Buy and been offered their expensive extended warranty plans? They are usually very costly, have many stipulations and conditions, and expire long before they are actually needed. Most manufacturers provide some initial warranty period. If you use your credit card to make that purchases, many cards offer consumers an automatic extension of that warranty period, sometimes up to 1 year or longer. Not only does this also provide peace of mind, but it can save you a lot of cash that you would have otherwise paid on these extended warranty plans.

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    Justin

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