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What are 5 reasons people would use credit cards

You are likely to learn financial responsibility from having a credit card. Since you are unlikely to learn about financial responsibility in any of your college classes, having a credit card may be a good way to start learning.

These travel protections can include auto rental coverage, trip cancellation and lost luggage. Booking your trip with a credit card may offer many opportunities. The interest rate that is given to you is primarily based on your credit history. Therefore, the higher the credit score, the lower the rate, and vice versa.

This means that you won’t have to pay interest during the length of this introductory period. If your card has this promotional rate on purchases, you may want to consider using it for a big purchase and pay off the balance before the interest free period ends. If you still have a balance after the period ends, you’ll be charged interest. Also consider a travel rewards credit card with a large welcome bonus to see if you can cut down the cost of your vacation by cashing in points or miles. The Capital One Venture Rewards Credit Card has a welcome bonus of 75,000 bonus miles once you spend $4,000 on purchases within the first 3 months from account opening.

Since debit card funds are instantly deducted from your checking account, any money spent on unauthorized charges will be gone. Automatic payments you’ve scheduled might overdraft as a result. If you report the theft within 60 days, the transactions can be reversed and the money restored. But this takes time and can be much more disruptive than a credit card theft. A major perk for getting a credit card in college is the potential to graduate with 4 years of positive credit history.

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Credit Cards Are Safer To Carry And Use

If your card issuer rules in your favor, then they’ll do a chargeback to get your money back from the merchant, but that means you won’t have that money throughout the dispute process. If you were to lose your wallet, you wouldn’t need to worry about someone draining your bank account, like they could with your debit card. You’ll just need to contact your card issuer to get a replacement credit card. Considering how rampant fraud is and that a new major data breach is announced seemingly every few months, security is more important than ever.

  • But we’re here to tell you that you can do all that with a debit card!
  • After reporting the loss to the bank, you will not be liable for any fraudulent transactions made on your card.
  • You may tend to overspend as the money does not deduct from your savings account now and end up with a huge bill to pay.
  • That protection assigns an expert to your case who will help you get your money back and clean up the mess (phew!).

Although some credit cards have annual fees, if you use one without an annual fee and pay your bills on time and in full, you likely won’t have to pay any fees for using your card. Many credit cards come with a number of consumer protections, one of which is rental car insurance. This means that if you pay for the rental car with your card, you’ll be reimbursed for the cost of theft or collision damage in the event of any incidents. Say your credit card is stolen or someone finds your card information online. If the thief starts making purchases, they aren’t spending your actual money.

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Other factors that impact your score are the length of your credit history, new credit applications, and your credit mix. If you’re looking for reasons to maintain your good credit, here are some great benefits to consider. The content on this page is accurate as of the posting date; however, some of the offers mentioned may have expired. Similarly, I once had to dispute a charge with an emergency plumber, when he charged me for work my landlord hadn’t authorized. I got the difference in money back from my card company, and was only charged for the original work order (which my landlord reimbursed). If you find yourself in this situation then look for a rewards card with more straightforward rewards.

  • Plus, if your credit card is used by someone else because it’s lost or stolen, the maximum financial loss is up to $50, according to the Federal Trade Commission (FTC).
  • When used responsibly, credit cards can be great for your financial well-being.
  • While you wait for your new replacement card, it would be wise to monitor your account and check for any strange activity or charges.
  • Enjoy 24/7 access to your account via Chase’s credit card login.

Most credit cards provide rewards points, which may be used on future trips. There are even travel credit cards on the market, which allow you to accumulate points or travel miles or travel miles on purchases. These add up and, in some cases, may earn you a free or discounted trip. In addition to the fancy travel perks everyone loves, credit cards offer some meaningful consumer protections you can benefit from if you play your cards right. Some rewards cards offer guaranteed returns — as in, your card will refund your money and let you return an item even if a store won’t. While you can buy your own travel insurance plan, many of the top travel credit cards offer different forms of travel insurance for free.

This card offers primary auto rental coverage, baggage delay insurance, trip delay reimbursement, lost luggage reimbursement, emergency assistance, travel accident insurance, and other benefits. If you lose your wallet or get robbed, any cash you were carrying is almost certainly gone forever. If thieves go on a spending spree with your credit cards, however, you generally won’t be held responsible for fraudulent purchases. It may take some time to sort out the resulting mess, but you won’t lose any of your money. With so many advantages of using a credit card, you should now think of having a card if you don’t already have one.