Smart budgeting and spending habits are a must when you want to use a credit card without building debt and paying so many dollars every month in interest and other charges.
When you shop wisely using your credit card, you can earn free rewards and other benefits not only to save but to earn more money as well. However, you should follow the basic rules a) pay for what you can afford b) make full monthly payments before the due date, in order to save a lot of bucks without getting into credit card debt.
If you are wondering how using a credit card helps you save and earn money, below are some of the ways that you can use a credit card to save money while spending it on day-to-day essentials.
Sign-up Bonuses
Do you know that you can take your money-saving plan to the next level by getting a new credit card? Yes, you can. Most credit card companies offer sign up bonuses to their new customers.
This means you can get a signup bonus right after getting a new card. The bonus amount usually comes with terms and conditions that you should follow to spend it on day-to-day purchases.
The sign-up bonus could be frequent flier miles, free reward points or free balance. As a result, you can buy more without spending extra bucks to save money for other important things.
Transfer Balances to Reduce Interest
If you have a card with a high-interest rate and there is a balance on it, you can perform a quick balance transfer to your new interest free credit card to save many bucks in terms of paying no interest.
Availing a 0% APR balance transfer benefit gives you enough time to pay off your balance without paying hundreds of dollars as interest. Hence, you need to make sure you can make monthly payments on time to pay off your balance as soon as possible. Otherwise, you will build a huge wall of credit card debt instead of saving money.
Cash Back
Since picking the right credit card offer is confusing and time taking, you should spend enough time choosing a credit card with enticing benefits like cash back. There are so many companies that return a particular percentage of your purchases in form of cash/balance.
Try to find a card that offers a bigger cashback parentage than others. Most cards offer cash back in different categories like gas, groceries, and restaurants. That’s why you should get a card that offers a good percentage on categories you spend more your money on.
For instance, if you travel often, you should get a credit card with at least 5% cash back on gas or fuel. In this way, you can earn a handsome amount of money every month while using your card for payments.
No Foreign Transaction Fees
Credit card companies usually charge their customers an agreed foreign transaction fee upon purchases they make in foreign countries or other currencies. And if you travel often either for personal or business purposes, the fee can add up quickly to increase your monthly bills.
This is where getting a credit card with no foreign transaction feel can come in handy to help you save hundreds of bucks every month. If you are traveling to another country, you should take your credit card with you for significant savings.
Before you use your card in another country, make sure to notify your card provider as they may lock your card as an act to keep you from fraudulent payments.
Extended Warranty Benefits
Purchasing an extended warranty for electronics items helps you save a lot of bucks on expensive repairs. But an extended warranty may also cost you several bucks.
Thanks to the credit card with extended warranty benefits, you can purchase more warranty on electronics purchases without paying an extra penny. However, you should read the fine print carefully before you purchase an extended warranty to learn what advantage you will get and how.
