subject: How to use your credit card for good [print this page] Funny how a small bit of plastic can seem to mean so much these days: the credit card has in some ways come to represent the financial habits that many have argued in part led to the global financial crisis.
Over borrowing to over spend, revolving door credit and unsustainable debt are all embodied in that little piece of plastic and many analysts have even gone so far as to pejoratively call out whole countries for having 'credit card economies'.
A credit card, though, is nothing in itself but only as good or as useful as the person using it wants it to be. Here are three ways that a credit card can be used for 'good', then.
Maybe Google's mantra 'don't be evil' could equally be applied to a credit card comparison.
Under that 'evil' category we might reasonably put high-interest credit card debts that can spiral out of control.
One of the best ways to use plastic, then, is to do just the opposite. 0% balance transfer credit cards reduce a high-interest balance to a zero interest one and in the process reduce the burden of the debt considerably. That's got to be good.
It's worth noting, however, that in most cases cards can only be used for this one good thing at one time. Offers on other transactions such as purchases sometimes aren't suitable to use with a balance transfer. For example, this is the case with the Virgin money credit card.
The second way to be good is to use a charity credit card to make the banks and other lenders pay out to good causes.
This is most worth it if you're a big spender but pay off your credit card at the end of every month. Without that proviso you'll give much more to lenders in interest than you'll make for a good cause in donations.
Note also that cash back cards often have a much better rate of return than charity cards so, if you can, it's better to spend on one of those cards and then donate the cash.
This also allows you to add gift-aid to your donation so the charity gets money off from the government too.
The third way to be good with a plastic card is use it for use abroad.
In this respect, credit cards designed for use abroad tend to be much better value even than debit cards and, as long as you fully understand the terms, are a much safer way to spend abroad.
