Keep the Dough: Times When Credit Works Better Than Cash

///Keep the Dough: Times When Credit Works Better Than Cash

Keep the Dough: Times When Credit Works Better Than Cash

There are probably plenty of times when you are glad to have a credit card in your wallet. It is not just the convenience of having a highly accessible means of payment on hand; it is also the rewards and even the protection that you gain access to when using a credit card.

Here is a look at why there are times when credit works infinitely better than cash.

Your Credit Card May Come with Plenty of Rewards

Getting points every time you use this credit card or building up some useful air miles just for using a convenient payment method, seems like a good deal, and when you look around to see what rewards are available, there is a good chance you can sign up for a deal that suits you and gives you something you want from your credit card, besides a line of credit.

Using a credit card to make purchases and getting points you can redeem for rewards is a no-brainer when compared to paying with cash, which doesn’t give you any points, of course.

Your Credit Card Can Give You Safety First

Although none of us likes to contemplate the thought of someone hacking our personal details or being the subject of fraud, like when we don’t get what we paid for online, this common scenario affects plenty of people every day.

One of the most attractive and important features associated with a credit card, is that it offers you a vital extra layer of protection, meaning you stand a good chance of not losing your money when someone tries to scam you. Credit card issuers usually provide fraud protection guarantees to encourage the maximum use of the card.

This added layer of protection makes it easier to shop with increased confidence and peace of mind, especially when travelling overseas, with unfamiliar retailers or wherever there is a concern about using a debit or credit card.

When you pay by credit card for a transaction that turns out to be fraudulent, such as paying for goods or services that don’t exist or weren’t as advertised, you can notify the credit card company. They will then dispute the transaction and put everything on hold until the situation is resolved.

In contrast, paying by debit card and finding that someone has compromised your card or stolen money out of your bank account means you will have to go through a lengthy and often nightmarish process while you wait to see if your money will get returned or not.

In the meantime, scheduled payments might bounce if your checking account is empty or lower than expected, causing you a lot of hassle and extra costs. Safety and security are two key criteria when it comes to financial transactions, and a credit card beats a debit card on both those counts.

An Easy Way to Improve Your Credit Profile

If you are trying to improve your credit profile by demonstrating financial responsibility and showing that you can handle credit, you are not going to be able to do that if you are paying cash for everything.

Although you might consider you are displaying prudence by handing over the dollars when you make a purchase, not only are you missing out on the consumer protection you get with a credit card, you are also missing out on the chance to potentially build a better credit score.

If you pay off the whole balance by the due date when the statement comes in each month, it will not have cost you anything to have used your credit card as opposed to using cash. Just as importantly from a credit profile perspective, you are allowing lenders to see that you can manage the credit given to you by paying on time and using credit responsibly.

The Whole Package in One Little Piece of Plastic

Getting useful protection from identity theft and fraud is worth signing up for, and the purchase protection plans offered by these cards will mean you are less exposed to any deficiencies in store return policies.

Add in the fact that you get the opportunity to be rewarded for just using your credit card, and you soon get to see how using one can offer you the whole package, from packing a punch in your spending power to enhanced consumer protection, plus more, depending on your card company.

About Erin Bradshaw

Erin Bradshaw writes about a range of personal finance matters, using her experiences of living paycheck to paycheck to finally getting her debt under control she shares her advice and tips with others on matters relating to money.

By | 2016-12-01T09:59:08+00:00 November 22nd, 2016|credit cards|0 Comments

About the Author:

Evan is the owner of My Journey to Millions which was started to track his journey from a broke debt ridden law school graduate to building a positive balance. Need more Evan? Follow him on Twitter, Contact him or get new posts directly to your email

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