Get the Most out of Your Credit Card in Canada: 5 Tips
Posted by Josephm09 on October 12th, 2020
Are you wondering how to maximise advantages from your credit card? Read this post to know the best ways to make a credit card work for you. Content: Credit cards can be a destructive weapon, or a useful tool - depending on how you put it to use. For people who can use it wisely, it can offer a host of benefits. However, many don’t use the credit card wisely, which leads them to problems such as debt issues. Mentioned below are five tips to make the most out of your credit card.
Choose the Right Credit Card
Well, the first step is to choose the right credit card that can work best for you. To ensure you select the right credit card, look at a few important things such as;
● Annual Fee: While there are some that don’t charge any annual fee, others charge a fee for maintaining the card. The one that charges a fee usually comes with added benefits and features.
● Interest Rate: An interest is charged on the amount that is not paid within the set deadline. This could be different for purchases and cash advances with the latter being more expensive.
● Insurance: Credit cards are prone to frauds, which is why you need to ensure that the transactions are insured.
Use the Reward Program
One of the key benefits of using a credit card is its reward program. For every purchase made through the card, you get reward points. These can either be in terms of points or cash backs. While reward points can be used for making purchases from the vendors of the bank, cashback offers more flexibility. Also, some banks allow you to choose categories on which you get a higher percentage of cash backs. Thus, you can choose a category based on your spending behaviour.
Use the Card to Build Your Credit Score
A credit card is not just for convenience. If used judiciously, it can be a great tool to build your credit score. As you get more regular with your payments, the bank will enhance your credit limit. It is essential to utilise the credit limit provided as it helps in improving the credit score. However, late payments can dampen your score.
Use Benefits Regularly
Most banks also provide a host of benefits to its credit card customers. From discounts at select outlets to offers that banks keep announcing, keep a lookout for the latest announcements, and you can gain some amazing benefits.
Pay in Full and Pay On Time
While a credit card can be a great tool if used wisely, it can also lead you into a debt trap. With easy payment option, many go overboard with the card without planning for their monthly expenses. To ensure, you keep it under check, only use up to a limit that you’re okay with and not what is provided. As per experts, make sure your debt to income ratio is within 40-45% each month. Also, make sure you pay in full and pay on time to avoid interests and penalties.
Use the Credit Card to Your Advantage
From providing flexibility to helping you make the most of your purchases, credit cards are an excellent choice for people with sound financial planning. Select the best credit card in Canada and use it wisely to make the most out of it.
A Book of Al Thatcher Card Magic by Gordon Boyd
After Hours Magic: A Book of Al Thatcher Card Magic by Gordon Boyd with contributions by Tom Craven, Stephen Bargatze, Gary Plants, Mike Powers, Dan Block, Steve Beam, Del Copley, Wynn Mertz, Nick Trost (Courtesy of H & R Publishing), Robert Bengel, Evert