4 tips to make the most of your credit card. We all know someone who is a true teacher to use his credit card: he goes on a trip, makes purchases or eats in restaurants while we ask ourselves, how does he do it?
Well, in this blog we tell you how.
The first thing you have to know is that the key to getting the juice out of your credit card is always paying your card on time.
As you well know, “plastic money” is not additional money and therefore before using it you should manage your budget well . And “card masters” are also teachers in managing their personal finances.
(If it serves you, we invite you to download this form to plan your monthly expenses ).
With the simple habit of always paying your statement on time, you transform your plastic into a great ally to improve your consumption experience.
The ultimate goal, beyond effectively paying less for various experiences and products, is to extract all the value your card offers. This is what this article is about.
Read on to know these tips to make the most of your credit card below…
Take advantage of discounts at partner stores
All credit cards have a network of associated merchants that offer discounts and promotions for using them in their units.
There are usually specific promotions according to the day of the week, such as discounts on perfumes or 2×1 in children’s shoes for example.
The most common categories are entertainment, restaurants, travel and fashion.
Each bank operates with a more or less exclusive network of associated businesses. Usually this information is available on the bank’s website. Some others have an app to see discounts and credit card promotions .
In this sense, having two credit cards can be beneficial.
First, because you will be expanding the network of associated stores that you can access.
Second, because some cards offer greater discounts than others. Therefore, you can pay with the most beneficial or choose which items to pay with what card.
Always use three installments without interest
The Defined recommends this principle with one of the golden rules of using credit cards .
The grace is that it gives us time to pay for things that we cannot buy in a single payment.
However, this varies by bank and some offer up to six months without interest. Many shops in any case are attached to give you 3 installments without interest without having to have the promotion of the current bank, take advantage of them.
The Defined recommends reviewing the Annual Equivalent Charge (CAE) and Total Equivalent Cost (CTC) , to be clear about the total amount you will pay for your purchases.
Use the points of your card
We all know someone who is a true expert to accumulate points with your credit card.
And they are right, because the grace is that the points allow you to pay from experiences – such as trips or hotels – to all kinds of items, make gifts or get cash back.
Your points are freely available, so you can do whatever you want with them, even make donations.
This is the way your bank rewards and encourages you to use the card.
The first thing is to know the rewards program of your card, because each bank has its own scheme to differentiate itself from the competition.
The key is to use your card constantly to accumulate points.
A good way to do this – which requires a LOT of discipline and responsibility – is to pay EVERYTHING, from a sweet to your department’s dividend, with your credit card.
The higher the amount, the more points you accumulate. At the end of the month, you pay ALL the statement from your checking account.
Cashback or cash refunds
A cashback rewards program is an incentive offered by credit card operators.
Under this type of program, a percentage of the card’s net expense (purchases less reimbursements) is returned to the cardholder as an annual, monthly or campaign reimbursement, in the form of a credit to his Credit Card reflected in his balance sheet.
Products such as cashback are more beneficial for consumers who pay their entire statement each month.
BONUS: Combine your card with a term deposit
This is an advanced technique that, again, requires a lot of discipline to produce benefits.
Above we recommend paying all your expenses with your credit card.
Why not put to work your salary deposited in your checking account in the meantime?
The way to do this is to put your salary in a renewable term deposit while using your card, and make money orders once a month to pay your balance.
Short term deposits go between 7 and 90 days. If you have money to cover 60 days so much better. Leave an amount in your checking account for emergencies and deposit the rest on time.
While your money is deposited generate interest, so you can stay with the difference once you make the turn to pay your statement.
Before finishing, we cannot stop reiterating that being disciplined – always paying your card before the expiration date – is mandatory for these tips to work for you.
Many of us associate credit cards with debt, but if you use it well you can get a value higher than what you pay using it.
With responsibility and consistency, you can also be an expert in the use of your credit card.