5 Reasons It Pays to Use Credit Cards Instead of Cash

You might have heard the advice to dispense with your credit cards and just use cash for your retail transactions. As a rule of thumb, that’s a great idea because you won’t be able to spend more money than you have. However, there are some times when it might be a better to use a credit card than to operate on a cash-only basis.

 

Here are 5 reasons it pays to use credit cards instead of cash.

1. Rewards

Think about it. What’s the reason that you do almost anything in life? Because you think that you’ll get some type of a reward for doing it.

Fortunately, some credit cards offer you rewards as well. The specific types of rewards that you receive depend on the card, but pay attention to credit card offers that appear in your mailbox. Open and read them so that you can see if they’re offering rewards that could benefit you.

For example, if you get an offer for a Chase Sapphire card that offers great travel benefits, and you’re someone who does a lot of traveling for your job, then you could benefit by using that credit card frequently.

2. Cash Back

You probably like cash. Cash is good.

Some credit cards offer cash back incentives. That means the credit card company will literally pay you to use the card.

You get paid to spend money. How cool is that?

Read the fine print, though. You might have to spend a certain minimum every month or year to qualify for the cash back. Also, make sure that the amount of cash back you receive makes it worth your while.

3. Frequent Flyer Miles

Did you know that airlines offer credit cards? In fact, it might be more difficult to find an airline company that doesn’t offer a credit card than it is to find one that does these days.

If you opt for an airline credit card, you might be eligible for frequent flyer miles. Usually, you’ll earn one mile for every one or two dollars spent. That means if you spend $3,000 per year on your credit card, you could have just earned yourself a free trip across the country.

If you’re somebody who uses a credit card for your business and you spend that much every month, you stand to benefit significantly from frequent use of an airline card.

4. Points

Some credit cards use the “Points” system as well. That means you can earn as many as five points for every dollar you spend. Those points add up as you use the card regularly until eventually you can redeem the points for something like a gift card at a retail store.

As a bonus, if the gift card doesn’t offer you anything, you can always give it to somebody else as a gift so that you don’t have to spend any money on a gift. That gives new meaning to “regifting.”

5. Security

When you use credit cards, you’re not spending your own money. You’re technically spending somebody else’s money. That means if you get a bad deal on an expensive item, you can call your credit card money and dispute the charge. The person who ripped you off will probably not get any money and learn the hard way not to be so dishonest.

Making credit card mistakes can be costly. However, there are also many great benefits to using plastic instead of cash. Be sure to pay off your balance every month, though, or you might pay hefty interest rates.