Financial counselors often advise people who can't control their spending habits never to use a credit card.
There are several factors why.
First up, you accumulate interest every time you use the plastic to make minor or major purchases.
Secondly, your balance goes up particularly if you pay only the minimum amount required and don't pay the full amount by the due date.
But if you're a responsible individual and you know how to manage your finances well, you can actually benefit from using a card.
Financial experts have identified five situations where it's fitting to use a credit or debit card.
Buying Home Appliances Major home appliances such as television and stereo system can be expensive.
But thankfully with a credit card, you can have the opportunity to own them.
The benefit of using the plastic in this situation is you get to test the functionality of the item before even you start paying for it.
In the event the product is defective, you can always exchange it or if the store will no longer accept an exchange, you can always report the matter to your card provider.
Online Shopping Online shopping is so popular these days mainly because of the convenience it provides to consumers.
And lucky you if you have a credit card because this is often the basic mode of payment required by retailers doing business via the internet.
This is regardless of the size and bulk of items you're buying online.
Just make sure that the online shop you're using has a secure website and payment feature.
Making Payments Paying your monthly utility bills and loans using the credit card is also a good idea.
By providing the company your card number, you no longer have to go to the payment centers each month to pay for a particular bill or loan.
It's very convenient as you pay all your bills one time only.
Take note, however, that you need to set this up first with your credit card company so that the bills are automatically charged to your card every month.
Availing of Rewards Many credit card companies have a rewards program that gives a user certain points every time he or she makes a purchase.
This is an advantage that will allow you to collect points and then exchange them later for items that you can use or a free airline ticket as in the case of credit cards that give mileage points.
What's important here is you pay off the balance every month so you can enjoy more stuff without having to spend for them.
Traveling Finally, you can enjoy free travel insurance from certain credit card providers.
This is most ideal for frequent travelers who may encounter issues such as a canceled flight or lost baggage during one of their trips.
You can ask about this feature from your credit card company to be sure about the incentive.
And just be mindful that using a credit card in other countries may charge you foreign transaction fees.