Everyone has a kredittkort today. The popular credit card is being used all across the globe and it doesn’t seem to show signs of slowing down. The credit card industry is going only up, and the reason for that is that the benefits are amazing.
However, everyone that has a card in their wallet is aware of the dangers of it too. If you have one and you’re not aware, then you need to read some literature on the subject and become aware immediately. There are many negative aspects of using it, so make sure you know them.
When you use a credit card it seems like there’s nothing that affects your income and your account balance. It’s not like that. Everything you spend needs to be returned to the card issuer, which is why you must know where to spend your money and where to avoid it. See how the system works here.
In this article, we’re talking more about the pros and cons of the spending habits of users owning credit cards. We will explain what are the items or services most suitable to use your cards for, and what the things that you should avoid paying with it are. Follow up and see what they are so you know how to handle various situations.
What’s normal to put on your credit card?
First, we’re going to talk more about the things you should be paying with your kredittkort. The items on the list below are best paid with it, so if you can choose, make sure you pull out the plastic from the appropriate financial institution offering the best options.
If you’re a frequent traveler, then you surely spend a lot of time on the plane. That means you need to buy tickets from one place to another. Unless you’re the pilot, there’s no other way to get from A to Z that’s located far away from each other.
Paying with a credit card that has rewards made with flying miles, gives you the chance to win more points as you fly. The more you fly, the more points you get, and more points mean you will receive more rewards. Since the reward is getting free tickets for your next trip – it’s best to pay with the kredittkort instead of spending cash and get nothing in return.
Similar to the previous idea, it’s best to pay for your hotel stay with a credit card, but not just anyone, but the one made specifically for gathering hotel reservation points. After you stay more than 10 or so nights, you’ll get one night free.
Of course, this may not look like anything special to some people, but imagine how it will look like if you pay with cash – you’re getting nothing in return. Paying with some of your cards means you’ll get a free stay after some time.
If you never use the option, and the points are stacked more and more to your account, you’ll be free to use them later. After a couple of years, you might get an entirely free vacation in a five-star hotel in another country. Who gives you a free vacation in a seaside hotel? Yes – your credit card.
A lot of people use the feature of grace period payment or simply put it on their card when they are shopping for electronic appliances. The reasons are many, and we’ll talk about a few of them now.
If you own a credit card, then you have the chance to buy something without actually paying for it until the next billing cycle. That means you can order the item you’re buying, but you’re not releasing the money just yet.
The reason behind this is that the vendor must provide perfect service if they want to see your money on their account. Even if you pay them, you can still withdraw the funds if the item isn’t working. Until they do the job right, you can keep the money in your account.
Additionally, you will get no interest charged within the window of no billing if you manage to return the money you borrowed in the first place. Let’s say the item is $3500 and you only have $3000. The rest 500 will be on your account after 15 days, so the card won’t charge interest for these 500 because you returned them in time.
When you buy over the internet, there’s always the chance to get hacked. If you keep paying in cash, no one can take your money without noticing, but online, it’s different. When you own a credit card, your account is safe because the funds on it are insured.
When someone attacks you and steals the money, you’ll instantly get them back from the insurance company. If the police say it is a hacker, then the insurance company is obliged to get them back, and this is why the kredittkort toppen is your best option for buying online.
What’s not recommended?
Just like some things are recommended to be paid by a credit card, other things are not. Let’s see some of the things that aren’t smart to pay for with your credit card.
Paying the tax
Paying the tax is not the smartest option. When the bill for the tax comes, and you don’t have the money, you shouldn’t put it on the card. The reason behind it is that you’ll be charged up to 2% of the transaction as a merchant processing fee. Why give this money to someone else by paying with your card, when you can do it other ways and save this 2%.
They might not be too much if the bill is $20, but not too many people pay only $20 for a tax. Most of them spend a lot more than this.
There’s no reason to pay for your college education with a credit card, as the loans for students are much more affordable than what you’ll pay with a credit card. Instead, get yourself a student loan and make the entire payment more affordable. There are tons of loans for students out there and you can choose one based on your needs, so do your research and get a loan instead of paying with a credit card.
The stock market is . When you put something on your credit card and lose the gamble, you’re ending with no stocks in your hands, no money, and interest rates that must be recovered. It’s the worst-case scenario, so don’t do it.
Now you know what the reasons are pro and against putting items on your credit card. As you can see, the benefits are more than the negative ones, but it’s still 50-50 when it comes to spending on something rather than not spending.
There are so many issues to talk about here that the story is never-ending. In general, if you make a great plan, you’ll find great benefits from paying with a credit card for some items, while others should be avoided by all means. Do your research, see what your lifestyle is, and make smart moves.