Shop And Save With A Credit Card

You’ve heard all about how bad credit cards are. It is true that a credit card, when used irresponsibly, can destroy your credit rating and plunge you deep into debt. But don’t go shredding your credit cards just yet. A credit card can also be your best friend if you use it wisely.

Let me go through two of the benefits of shopping with your credit card.

0% Balance Transfers

If your current credit card has a high interest rate you can save a nice amount of money by switching to a zero percent balance transfer credit card. Usually these types of credit cards do not charge you interest on the balance you transfer for a period of one year. After that period, the card goes to their standard rate.

Be careful with this method, however. Only transfer your balance if you are sure you will be able to repay the credit card in full by the time the trial period is over. If you don’t pay it back in time, the interest rate on this new card will kick up to as high as 29% and you won’t end up saving any money at all.

Rewards Program

Typically it costs money to use a credit card. Some of them have yearly fees and they all charge you interest. However, if you have a card with no yearly fee and you always pay your balance in full on time, you won’t be charged anything to use your card. But if you can get a rewards credit card, you can have your credit card actually pay you back every time you use it.

If you can responsibly use a rewards credit card you should make all of your purchases through it in order to maximize your savings. You can pay your utility bills, grocery store costs and fuel with your credit card. One of the benefits of doing this is that it will show you on your statement exactly where your money is going every month. You can then get either a gift card, a statement credit or a check to cash in your rewards.

Anum Yoon

Anum Yoon is the founder and editor of Current on Currency. She loves all things personal finance, which is why you'll find her work all over the PF blogosphere. Catch her updates on Twitter @anumyoon!

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