5 Reasons To Actually Use a Credit Card
Recently, I experienced a bit of a financial setback. Actually, I experienced a large financial setback but that’s a story for another time. In any case, when researching the best ways to rid myself of debt and get back on track, I read many sites disparaging the use of credit cards and expounding on the evils of plastic.
Because you’ve stumbled across this site, chances are that you’ve read the same articles I have. It can’t be all true, can it? Using a credit card now and again surely won’t cause your world to end. In that vein, here are the top five reasons that using a credit card is a good idea:
5. Build Your Credit
Okay, you may be thinking, but my credit is already in the toilet. While that may be true, using a credit card and paying your bill on time every month will slowly begin to rebuild your credit. Notice that I did say “slowly”. If you’re a glass half full kind of person, slowly building your credit is better than not building it at all.
Try to secure two credit cards: one from a financial institution and one from a gas station, department store or online shopping site. Use them only when you have enough cash to finance your purchase and then pay off your bill when it comes in the mail. In that same manner, you can use your card for gas station fill-ups instead of your debit card. By charging small amounts and paying them off monthly, you’ll see your credit score begin to rise over time.
4. Emergencies
If you’ve got poor credit, you can still apply for and receive a secured credit card. Use this card as an emergency fund of sorts. Coming up with $500 or $1000 for car repairs, pet emergencies or even human emergencies can be tough. A credit card will afford you the opportunity to take care of problems without having to stress about the cash.
3. Interest Earned
You’re going to have to follow me here. This is a great way to both rebuild your credit and earn a bit of money if you’ve got a credit card with an introductory rate of 0%. Take a cash advance and put the money into an interest earning savings account. Make the minimum payments on your card until just before your interest charges begin and then pay off your balance in full. You aren’t going to earn hundreds of dollars but you can earn enough to fill your tank.
2. Rentals and Tickets
If you need to rent a car, you’ll need a credit card. This is the case with many things in life. Even if you aren’t going to use it to pay for your rental, the company will want it on file. If you don’t have a credit card, don’t expect to be renting a car any time soon.
Credit cards are also handy for booking airline tickets online. With sites like Travelocity, you can get better deals on tickets than you would using traditional purchasing methods. These sites don’t take cash or checks!
1. Convenience
Without a doubt, the number one reason that credit cards are, indeed, a good thing, is their convenience. I hate carrying cash, probably as much as the people behind me in the checkout line hate that I only pay with credit cards! I’m not paranoid and my chances of getting mugged are slim, but if I don’t have cash on me, it can’t get stolen. And if my credit cards get stolen, I can simply cancel them. Easy peasy, right?
Obviously, irresponsible use of credit cards is a bad thing. If you can use your cards with a modicum of common sense, they aren’t bad, they’re good and they’re handy. Pull out your credit cards and start charging!
Author Jessica Stevens is a financial consultant and content contributor for wisebread.com, a site offering reviews on the top travel credit cards and great money tips for living large on a small budget.
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