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Why You Must Not Hesitate to Use Credit Cards!

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Taking a realistic view about credit cards should help in the proper understanding of its benefits for users. Most people find credit cards attractive because of the convenience of getting ready money at the drop of a hat. This helps to fulfill their wishes. But this is only the tip of the iceberg. There are many things that are not outwardly visible but affect the financial status of cardholders positively. Credit card money is attractive only if you can timely pay the balance of monthly bills to avoid paying any interest.  However, the risks of credit card abuse are also quite high. This is why many personal financial planners often advise against using credit cards. This might appear to be an extreme decision because credit cards are not bad. This is more so if you can use it in a disciplined manner. You must know how to derive the benefits.

You can gain in different ways by using credit cards. The only condition is that you avoid the lure of swiping it recklessly. This is as it translates into uncontrolled spending. Let us now look at the ways you can derive various benefits, both direct and indirect by using credit cards.

Earn Sign Up Bonuses

Rewards and perks are integral to credit cards as credit card companies use it as a marketing tool. The rewards start coming right from the time credit companies welcome new customers by offering them sign-up bonuses. These bonuses can range between $50 and $500 depending on the prevailing scheme. But rewards are not always in monetary form. This is because many credit card companies offer reward points on signing that users can redeem for fun stuff. However, some credit card companies do not offer any rewards or minimal rewards.

Rewards and Points System

To encourage more use of credit cards, credit card companies use rewards as carrots. These work very well in helping them achieve their business objectives. Rewards are often points that credit card users earn depending on how much they spend. For example, you earn some specific points for specified spending amount.  The points can increase many times during special promotional campaigns of credit card companies. Here, you earn multiple points that can be even double the points earned usually for spending in some specified categories. These categories are like transportation, restaurant or some specified retail outlets.

Frequent Flier Miles

Credit card companies work together with various airlines and offer frequent flier miles program to its customers. Under this, when flying and buying tickets using a specified credit card, you earn a mile for some specified dollars. These are the dollars that you spend on buying air tickets. For example, for every dollar or two dollars spent, you earn a mile that you can redeem later.  You can redeem the accumulated points at some later date when the points might help getting a travel ticket free. This is when you realize how much benefit the credit card is for you.


There is nothing more enjoyable than getting some cash back for purchasing something by using a credit card. The cash back is usually a percentage of the amount charged on credit card that returns to your account. You can buy anything to qualify for cashback provided the credit card company is offering the scheme.  The cash back can be 1% of balance refund and can go up to 2%, 3% or even higher. This offer works on purchasing selected items. However, some credit card companies might attach some conditions to avail the cash back.

Get A Fair Deal from Vendors

Credit card companies can sometimes mediate between you and some vendors with whom you might be having some trouble with the quality of service or material delivered. Suppose you appointed a home remodeling company to undertake some minor tile repairing job in the bathroom and pay them by using a credit card. In case if some defects in the work appear after a few days, you can take help from the credit card company to mediate and resolve the problem before releasing payment. Based on your complaint about unsatisfactory work the card issuing company can withhold the payment to the home remodeling company, and you not only get your money back but also get their help in finding a new contractor.

Balance Transfer

Some credit cards are great for balance transfer and known as balance transfer credit cards. If you accumulate high balance on some credit cards and are unable to pay it off on time, to avoid paying interest you can transfer the balance to another card that offers 0% APR for a specified period. However, you must have a plan for paying the balance within the interest-free period or else if you must pay interest, it defeats the purpose of transferring balance.

Grace Period

When you use a credit card, you can enjoy interest-free credit for a certain period depending on the date of purchase and the billing date. The benefits are two-fold – firstly, the money remains in your bank on which you earn interest, and no matter how small it might be, it is your gain. Moreover, if you make payment from a high-interest checking account, then the interest earning during the grace period of the credit card can be substantial. Secondly, the interest you save on the balance payment is another gain.

Wider Acceptance

Credit card payment is more acceptable over debit card payment by car rental companies and hotels because it becomes easier for these companies to recover money from customers for any damage done to cars or property. These companies are more inclined to accept credit cards over debit cards.


Rewards like points travel miles and cash back are not the only benefits that come with credit cards. Many credit cards come with a variety of insurance cover free of cost for its users like travel insurance, car insurance, and health insurance. Some may even offer some product warranty that extends beyond the manufacturer’s warranty.

The opportunity of building credit or improving your credit score is the most rewarding benefit for credit card users.


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