Irresponsible credit card use is one of the leading causes of debt, but credit cards are not inherently evil. If you’re aware of how to use one responsibly, you can take advantage of some amazing benefits. Here are four great reasons to get a credit card.
One-time Bonuses
Some credit cards offer bonuses of over $150 after you hit the spending cap in the first couple of months after you open your account. Alternatively, you might be eligible for bonus reward points or miles. You can redeem these points for travel, gifts cards, merchandise, statement credits, or checks. Just to compare, on your debit card, there are no bonuses or chances to cash in on any rewards you accumulate.
Getting Cash Back
When the concept of the cashback credit card first became popular, customers could get about 1 percent of their purchases paid back in cash. Today, that number can go up to 6 percent. To take advantage of a cashback card, try applying for one with minimal fees and interest and a high reward rate.
Earning Rewards Points
If you are already spending money in certain spending categories like restaurants, retail, and hospitality, consider a reward credit card. These cards let you rack up points as you spend, and when you reach a certain earning threshold, you can redeem these points for massive benefits. Try to find a card that aligns with where you spend your money anyway, like a card offered in partnership with your favorite hotel chain or one that is partnered with a favored retailer earns you almost endless rewards.
Accumulating Frequent-flier Miles
This is the most talked-about perk from credit cards and is invaluable for frequent flyers. When the offer was instituted in the early 1980s by Citibank, it took off instantly because consumers had the opportunity to earn miles even when they weren’t flying. Today, it works like this. You’ll earn one mile per dollar in net purchases, or sometimes one mile per two dollars. You can then purchase a flight ticket with your points or miles. Consider this: Frequent flier cards often have attractive introductory bonuses which shoot you more than 50 percent toward an award flight.
