11.16.2010

Use Credit Cards for Good, Not Evil

During this time of year, we all start dropping money like it's going out of style. Christmas presents, birthday presents, dinners with friends and family, holiday outfits, decor, food, travel, the list goes on and on. If there's any point in time when people use credit cards, it's now. Generally, this makes us nervous - we know that putting anything on credit cards is bad, right? Not necessarily! There can be very nice rewards for making all these large purchases on credit cards if you know how to play your (ahem) cards right! Here's some tips to be a more savvy spender:
  • Store Credit Cards:  Most money management websites and articles will give you the advice to NEVER sign up for store credit cards. Their points are valid: the cards have high interest rates, and they can tempt you to buy things you don't need. However, if you already spend a lot of your money in a particular place, the benefits of being a cardholder can outweigh the negatives. Some stores have amazing cardholder benefits! Take a look at Nordstrom or Macy's - both have points systems that give you gift cards once you spend a certain amount, which equals money back in your pocket. They also give you access to special sales, additional discounts, and more. Even smaller stores, such as Banana Republic and Express have pretty perks - Banana Republic has a Visa card that's good anywhere and earns you reward points on everything from gas to groceries. Express cardholders are entitled to significant discounts, as much as 40% off. Even better, if you know you are going to get a motherload of Christmas presents at a specific store, you can usually get a pretty good discount just for signing up for the store card. Another 20% off on top of sale prices or other discounts can really add up! Make sure you pay off your balance each month and only buy what you need, but it makes perfect sense to get rewarded for the things you would have bought anyway!
  • Travel Credit Cards:  These cards are a great idea for the frequent traveler. Earn points on money spent on airfare, hotels and rental cars to get money back in the form of airline miles or even cash. If you belong to a frequent flyer program, such as Delta SkyMiles, find a card that will help you accrue SkyMiles on everyday purchases to help offset the cost of travel. Again, make sure you pay off your balance each month and you'll be sitting pretty with discounted seats, free checked baggage, and even free upgrades.
  • Reward Credit Cards:  Everyone should have an "everyday" credit card. You know, the one you use for your usual purchases like groceries, dining out, and gas for your car. Since you use this card every day (and pay it off every month...right? RIGHT?!), it only makes sense that it should do some work for you. There are tons of cards out there that can get you points for rewards, cash back, and more. Do your research before picking a card and make sure it fits your lifestyle.
The bottom line is that credit cards can be a great asset to a shrewd shopper. Make 'em work for you, but don't forget, MAKE SURE YOU PAY YOUR CARD OFF EVERY MONTH!

1 comment:

  1. Ive gotten a couple cruises! OK ..end of my story. : )

    ReplyDelete

Note: Only a member of this blog may post a comment.