Every month a new credit card bill arrives in the mail, yet you dread going to the mailbox. You may find yourself wondering why you don’t just cut the little piece of plastic in half and all your troubles will disappear. Unfortunately establishing credit is an important part of adulthood, without good credit, it is hard to purchase important things like a car or a house.
However, there is a light at the end of the credit card tunnel that many feel they will never see. This light is called the credit card benefit.
Unknown Credit Card Benefits
What are these benefits? We have a few things below listed that you may want to keep in mind when choosing your next credit card. Below are the top three reasons to have a credit card and be aware of these benefits.
· Fraud
As you know many know accounts come with fraud protection. This valuable benefit protects the card holder from being held liable for any unauthorized charges should your card be lost or stolen.
· Card Replacement
This credit card benefit is probably the most necessary one to retain. If you are on vacation or a business trip and have no cash, but have lost your card, most companies offer emergency cash or they can send you a new one within a 24 hour period.
· Rewards
Many credit card companies offer reward programs for the card holder to take advantage of every time they use their card. This credit card benefit is a valuable tool when it comes to credit card usage. These rewards can get you many discounts on travel, vacation, air fare, hotels, etc. You may even get free stuff, just for using the card. These rewards may sound appealing so choose a credit card that has the best deal for you.
· Returns and refunds
These credit card benefits are a hidden gem and one many are unaware of is possible. For instance, when you make a purchase at one store then find the same merchandise at a cheaper price at a different store, your creditor can refund the difference in the two prices, but beware because their may be stipulations involved. Another perk to having a credit card is the replacement of something that is damaged or stolen, once you have purchased it. Some not all credit card companies will replace the item as long it is within a certain amount of time. If you happen to wait too long to return something your credit card company may offer a longer return of 30 to 60 days.
Sidestepping the Dangers of Using a Credit Card
Despite the credit card benefits that are offered through credit companies, utilizing them will be fruitless if you act irresponsible with your credit card. Keep yourself out of credit card debt by following these simple steps
· Living Beyond Your Means
Credit card debt is still a driving force in many American households today. The main reason is people are living beyond their means. A credit card is easily used as a weapon to gain a lot of material items as well as impressing your friends. Don’t bite off more than you can chew.
· Budget Yourself
Almost all credit cards come with a limit. The limit is the line of credit the company has given you to spend for example Capital One may give you a limit of $500 this means you only have that much to spend. A word of caution do not spend the whole $500 because you have to pay it back with interest. Always include your credit card bill with your monthly budget so you know exactly where you stand financially.
· Pay the Bill in Full
Once the bill comes in the mail pay it in full, this will illuminate the accruing interest and finance charges involved with credit cards. If it is possible only spend what you can pay off.
· Request a Lower Interest Rate
This is the final credit card benefit people are unaware of, credit card companies can raise or lower your interest rate whenever they want, but they must give you notice first. A few things will happen as a result, first they will try to convince you to accept the new rate, second they will agree to not change a thing, third is both parties will come to an agreement to part ways and close the account then settle the remaining balance.
Everything that has been mentioned so far are just suggestions and guidelines to having a credit card. If the credit card is used responsibly these benefits can work in your favor. Use your common sense and try not to spend more than you can afford, so you can reap the benefits and not put yourself in a financial hole. Final thought no matter how much you want to make an impression, it is your credit rating that will be affected.