Credit Cards Are Better, Safer, Smarter. Always.
Today, over a billion of people rely on credit cards rather than cash. They prefer plastic money over hard cash due to a lot of reasons, such as plastic money can encompass plenty of money, it is easy to carry, etc. However, there is a negative side to this too, as more and more people are burdened by credit card debts – but that’s where CreditSmart comes in! Be SMART about your spending! Treat your credit card like cash and never spend more than you can pay. This method will earn you lots of easy rewards and build your CIBIL score. Some stubborn people still prefer to use cash over credit cards, as is evidenced by the many articles that you can see on the internet regarding the benefits of using cash.
And, the logic behind this is sensible enough, that is if you do not carry credit cards, then you would not get tempted to fall into a debt trap. But, the main question here is what is the overall benefit of credit cards on your finances? The answer? It’s must better to use a credit card for the huge benefits. So, let us have a look at some of the reasons as to why you should opt for credit cards instead of cash.
1. Credit Card Rewards
The sole purpose of offering credit card rewards to people is to entice them, so that they apply for their credit cards. Credit card companies offer rewards to people thinking that users will accumulate more in interest charges and fees than the amount of rewards the companies are shelling out. Therefore, it is a great deal for them. But, you can reverse their intentions by actually making some money from your credit card. How? Just follow this:
- Make the most of your credit card rewards: Choose a credit card as per your lifestyle and expenses. For instance, if you are a frequent traveler, then go for a travel credit card that offers discounts on airline tickets and hotel stays, in addition to free miles. If you want cash back, then go for a cash back rewards credit card.
- Specific card for specific use: Use the particular credit card for its specific reward, such as a card that gives you 5 per cent cash back on groceries should be used every time you go out to buy groceries, a card that offers 3 per cent on gas should be used every time you fill up your tank, etc.
- Avoid fees and interest: You can avoid the fees and interest on your credit card by paying off the balance in full at the end of each month. Unless your credit card charges annual fee, you will save all the extra money that you earn from the rewards on your credit card.
Credit cards are much more convenient than cash or even debit cards. With them, you do not have to run to the ATM or count the exact amount of money every time you want to make a purchase. You can easily swipe or chip it at the retailer’s store. Plus, many hotels, airlines, and car rentals do not take debit cards or cash anymore. 100% better when traveling as well.
3. Raise Your CIBIL Score
Credit cards help you to boost your credit score. You may not even realize this fact, but it is nonetheless true. So, if you do not use a credit card, your credit scores can get dramatically hurt. This is because credit scores are generally based on your credit utilization and credit history. And, if you do not use a credit card often or do not have a credit history, then your score will be based on nothing and thus your credit score will be considerably low.
4. Offer Security
Many people think that cash is a much safer option than credit cards, with all the hacking stuff that is going on nowadays. However, contrary to this belief, cash is also susceptible just as credit cards are. Banks too can get hacked just like credit card companies. And, if you use online banking or a debit card, then also your account can be hacked easily.
Still, if you are the kind of person, who cannot control their spending habits, then you should definitely stick to cash – but know your CIBIL score will suffer and not grow. But, if you are wise in using your credit card just like cash and pay off your credit card balances every month, then credit cards should be your pick.