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subject: Save Money Using A Credit Card [print this page]


As a smart consumer, you have probably associate credit cards with companies who are trying to get you in debt and all the evil stuff that is associated with it. That said, prudent and smart usage of your credit cards can actually save you money in the long run. With that said, how can you use the credit card to your advantage?

Let the interest work for you

Most of us understand how credit card companies works; they make a profit by charging you a monthly interest. However that do not have to be the case for you, since they only charge you an interest if you fail to pay full every month, what you need to do is to pay full every month. If you have a good habit of paying full every month, not only they can not charge you interest, you will even get the chance to get up to 2 months of credit free interests.

This can happen because the card company will usually need to give you at least 28 days after your statement due date to pay your card, as such if you buy a product shortly after your statement have come out, you will theoretically get another month to pay off that product, since you are waiting for a new statement to reflect the purchase.

As a result, if you are a good and conscious saver, what you can do is open a savings account and every time you make a payment on your credit card, you transfer the money you would have spent on the purchase to the savings account. Then, on the credit card statement due date, you transfer the money from the savings account to pay the credit card bill. In the meantime, the interest that has accrued on that money while you were waiting for the credit card bill is all yours!

Using the loyalty bonus scheme

Another popular thing that most credit card companies will offer is bonus scheme, or a loyalty program, which means you, will accumulate points everytime you spend money with your credit card. With enough points, you can even use them to purchase a product or redeem a free product from your credit card company.

Since you now do not have to use your money to buy the product thanks to these loyalty schemes, you can effectively generate more money by investing the money in your savings accounts or other form of investment.

by: Steve Busche




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