Credit Cards are a dangerous business. Some of us use them to finance things they should not purchase…some don’t. Sometimes they are the only answer when you need to pay for an emergency. Bottom line is we ALL need to be careful of credit cards. With all that said I have some hacks to get the most out of responsible credit management.
- Stack your benefits – I use my Chase Southwest Card as much as I can. It has an annual fee of $99 but that is balanced with free points for air travel. I pay for EVERYTHING that I can on that card, then I pay it off at the end of the month. I use the points to buy air travel for vacations…winner me. The reason this works so well is that I travel for a living and the points add up quickly. Also, there are some additional benefits like car insurance when you rent a car.
- Use cash back – if you have a Discover Card you can use your cash back to pay your bill and/or to pay for items on Amazon. The interest rate is 20% which is VERY high. You MUST pay off the balance at the end of the month to make it worthwhile. Also, don’t forget to sign up for the quarterly 5% bonuses.
- If you have a Visa or Master Card from a gas station please make sure that it is ‘no annual fee’. Usually those cards offer extra points on gas station purchases and sometimes even a discount per gallon at the pump…read the terms carefully.
- The last on my list is American Express. The AmEx Blue Cash Preferred (review on nerd wallet) with a high rewards rate (6%) on a max of $6k on groceries (per year) with unlimited 3% on department stores and gas, and 1% everywhere else.