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5 Ways to Get the Most Out of Your Credit Card

Sep 25, 2023

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Credit cards can enhance your purchasing power by allowing you to postpone payments, but there’s far more to them than that. Cards come with many features that offer plenty of benefits beyond the ability to borrow temporarily. Therefore, knowing the best ways to use your credit card can make it a powerful asset. This article will explore a few tips to get the most out of your credit card’s features and benefits.

1. Pay your balance in full

Carrying a balance causes your credit card issuer to charge interest and add it to your balance. Canadian credit card APRs can vary, but regardless of what your APR is, carrying a balance can cost you a lot in interest. This may erase the benefits of your rewards. Plus, it can be easy to get stuck in debt. Therefore, aim to pay your balance in full every month. You’ll save on interest and avoid unintentional late fees.

2. Maximize your rewards

One of the best credit card features is the ability to earn rewards. Credit cards can vary in their rewards rates. For example, if your card offers 5 points per dollar on quarterly rotating categories, make sure you activate the new rewards categories quarterly and spend in those categories with that card.

Or, perhaps your card offers 3 points per dollar on a category you choose, and you can switch that category once a month. Evaluate your spending habits regularly and select the category you spend the most in. 

Lastly, take advantage of welcome bonuses. This can earn you a few hundred dollars if you spend a particular amount within a specific timeframe after opening an account. For example, you might earn $150 after spending $3,000 within three months of opening the account. If you have a big purchase to make, this effectively lets you knock $150 off that purchase. Compare welcome bonuses different cards offer before you apply for a credit card online.

3. Take advantage of the introductory promotional APR

Many cards offer 0% APRs on purchases or balance transfers for an extended period, which can vary by card. Introductory 0% purchase APRs can be great for large purchases, such as furniture. They let you spread the cost across several months without interest. You can combine this with a welcome bonus to save more.

Introductory 0% balance transfer APRs can help you consolidate and refinance credit card debt. You can move balances from other cards to the balance transfer card and spread your repayment across several months. This can streamline your debt management and allow you to save money on interest. Just be aware of the fee — many balance transfer cards charge a small percentage of the transferred amount.

4. Use your other perks

Many cards come with several perks beyond rewards and welcome bonuses. Using these can help you make the most of what your credit card has to offer. Common perks may include:

  • Cell phone insurance and protection
  • Purchase protection and extended warranties
  • Fraud protection
  • Special event access (such as concerts and sporting events)

5. Keep credit utilization low

Credit utilization is a credit score factor that measures your individual and aggregate credit balances against credit limits. Keeping the utilization ratio low can help you build and maintain good credit, which can ultimately give you access to better credit cards and more favourable loan terms.

The best way to keep utilization low is to avoid changing your spending habits after getting a credit card. You’ll get to earn rewards and enjoy the other perks while maintaining a good utilization ratio. That said, card issuers may close your credit card account if unused for too long. So, make sure to spend with your card, but try to keep your balance as low as comfortably possible.

Make the most of your credit card

Credit cards can be powerful tools when you know how to use them effectively. Pay your balance in full each month to avoid debt, and optimize your card usage for maximum rewards. Going further, take advantage of welcome bonuses and introductory APRs to build up more rewards and minimize interest. Explore and use other perks, such as purchase protection and travel insurance. Finally, use your card regularly while keeping the utilization low to build your credit score. Following these tips will help you reap the benefits of credit cards while minimizing the potential downsides.

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Contact Information:

Name: Carolina d’Arbelles-Valle
Email: href="mailto:Carolina.darbellesv@iquanti.com">Carolina.darbellesv@iquanti.com
Job Title: Senior Digital PR Specialist
(201) 633-2125

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