Effective credit card use requires smart budgeting and spending habits. This helps you prevent the dangers of getting into credit card debt while saving a lot of bucks at the same time. When you shop carefully or make payments strategically as per communicated terms and conditions, you can earn and save a big deal of money daily. And you can do it all without building a wall of debt if you really follow all the rules and terms. You should swipe for what you can afford and make monthly payments on time.
Here is how you can earn and save money with credit cards to make life easier and avoid financial issues.
If you are planning to get a credit card either for personal or business uses, look for one that offers an enticing sign up bonus. Such bonuses offered by issuers can range from cash back, and free air mileages to free reward points that can be redeemed on household items, groceries and streaming services etc. Earning sign up bonus may require you to spend a particular sum of money using your card in a specific period of time. If you are able to meet terms and can make payments on time, it would be a great chance for you to get more in less.
Transfer Balances to Reduce Interest
If you have a credit card with high interest rate and carry a balance on it, you can save hundreds of bucks by transferring the balance to a new balance transfer credit card on better terms. These cards allow you to transfer debt or balance of your other cards and provide you with enough time to pay off your balance with zero to the lower interest rate. This not only helps you save bucks on interest but also allows you to consolidate and pay off your credit card debt conveniently without putting strain on personal finances. However, you should read the fine print carefully and pay enough every month to avoid higher interest when the grace period ends. Otherwise, you will be building more debt instead of saving money.
Free Rewards Points
Credit cards are normally promoted with alluring perks and benefits to attract more customers. Most credit cards are designed to help cardholders earn more benefits and free rewards points whenever they swipe. Many issuers offer bonus points and rewards when paid for certain categories. Earned points are easy to redeem when a user reached to certain points earning threshold. For example, if you travel often and your credit card offers free reward points upon each hotel booking or an air ticket, you can redeem those earned points later for a free air ticket or hotel reservation. As a result, you can save many dollars that you can spend on other things to make your life easier.
Free Travel or Hotel Stays
There are some cards specifically designed for travel geeks. They allow users to earn free air miles or points for free hotel stays and flights. If you are using a travel card with enticing rewards features, you can then earn free flights for family vacations or holiday travel to save money on traveling. Even if your card doesn’t have travel-specific rewards, you can earn discounts on travel deals and trips to save more. However, make sure to check the terms and conditions of your card before paying for trips and travel plans.
No Foreign Transaction Fees
Universal acceptance is another attraction of credit cards. Since credit cards are widely accepted for online purchases and international payments, more and more people are getting credit cards. Most credit cards come with almost 3% transaction fees on foreign transactions. This can add up quickly. Thanks to credit cards with no foreign transaction fees, you can save a lot of bucks in terms of paying no fees when using a credit card overseas. If you travel often and like to pay via credit card, you should get a card with no or lower foreign transaction fees so you can make significant savings while visiting your favorite country or state.