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4 Reasons to Use a Credit Card to Pay for Vacation

December 20, 2017 Wise Dollar Travel No comments

There are few events throughout the year quite as exciting as heading out on a vacation. Whether you are traveling with your spouse and your kids, just your significant other, or even all alone, vacations are a great way to step out of the day-to-day routine of life.

With a little planning and saving in advance, you can enjoy a memorable vacation that will immediately have you looking forward to your next travel adventure.

When getting ready for a vacation, there are several different planning tasks required. You have to make an itinerary of some kind, you need to make reservations for things like transportation and lodging, and you need to determine how you will pay for everything. This last point is the topic of this article.

While on the average trip, you are going to spend a significant amount of money, often in a variety of different locations. We recommend considering the use of your credit card for most, if not all, of your purchases. The following four reasons highlight why you might want to use a credit card to pay for vacation.

1. Security

Most credit cards come with a variety of customer benefits in terms of security. Your purchases are likely backed by some kind of guarantee, you should have protection against fraudulent charges, and your bank may even call you if anything looks out of the ordinary.

When spending money in an unfamiliar place somewhere far from home, it is nice to know that your credit card company will be on your side. Of course, you should always check on the specific benefits of your card before you travel just to make sure it offers the features you need.

2. Budgeting

By placing all of your charges during the trip on the same card, you can easily see how much you spent when you return back home. This will be helpful in terms of budgeting for future vacations.

Did you spend more or less than you expected? By how much were you off? Taking even just a few minutes to review the trip when you return home will help you plan out your next trip in even greater detail.

3. Go Cash Free ? Or Almost

Many tourist destinations are hotspots for pickpocketing activity, as criminals know that tourists will be carrying plenty of cash that they can try to grab. Don?t give them the opportunity.

If you plan on using your credit card for nearly all of your purchases, you can protect yourself by simply carrying very little cash. It is smart to have a little bit of cash on hand for small expenses where credit cards might not be accepted, but limit how much you carry to reduce exposure to theft.

4. Rewards!

If you are going to spend quite a bit of money on a big vacation, you might as well get a little bit of that money back in the form of rewards on your credit card. Depending on the card you have, you may get cash back based on the size of your purchases, or you may get points which can be redeemed for a variety of things.

Do you use a credit card to pay for vacation? Why or why not?

Photo courtesy of: 12019

5 Ways Credit Cards Can Be Good for Your Budget

October 26, 2016 Wise Dollar Credit No comments

When you think about using a credit card, you might think about them in a negative light. Obviously, running up credit card debt is not desirable for your financial future, so many people choose to avoid cards altogether because of this concern.

However, when used correctly ? and responsibly ? credit cards can be good for your budget. They are actually be a useful financial tool with almost no downside.

If you are trying to decide whether or not you should start using credit cards in your day to day life, consider the following ways credit cards can be good for your budget.

Build Credit Score

This is the point that most people know about, and it is extremely important. Using a credit card, and then paying if off?on time each month, is a great way to build up your credit score. You will be essentially ?proving? your ability to pay off debt, so creditors will be more likely to lend you money in the future for larger purchases like a new car or house.

Save on Interest Rates

Tying in to the point above, you can save money down the line thanks your higher credit score. A higher credit score can help you by securing loans with lower interest rates. You will be seen as less of a risk when you have a good score, which you’ll have built by using your cards responsibly.

Get You Through a Month

You naturally don?t want to have to carry credit card balances for long periods of time, but carrying a balance for just a single month won?t cost you much in interest if you need to work your way through a big purchase. If there isn?t room in your budget for a purchase that you need to make now, using a credit card to give yourself a few weeks of time to put that money together is a reasonable option. That being said, if you don’t know where the money is going to come from them you should steer clear of using that credit card.

Earn Rewards!

Who doesn?t love getting free stuff? If you use the right credit card on a regular basis, you might find that you accrue a variety of rewards that you would not have earned by simply using a debit card. The best part is that this strategy doesn?t need to cost you anything at all, and it won’t as long as you are paying off your statement balance by the due date each month. Look for a card that offers rewards which interest you, like travel rewards or cash back, and make sure there is no annual fee that goes along with it.

Learn Money Management

It can be tempting to have a big credit line at your disposal. But holding a credit card or two is a great way to teach yourself how to manage money properly. You can use your cards to purchase things that are within your budget and you were going to purchase anyway, but resist the temptation to buy things that you don?t need and can?t really afford. Money management is an essential skill to learn and can be easily taught with credit cards.

Do you use credit cards for any of these reasons? Can you think of other ways credit cards can be good for your budget?

Photo courtesy of: Sean MacEntee

4 Ways to Stop Swiping Credit Cards So You Can Get Out of Debt

July 13, 2015 Wise Dollar Credit, Debt 12 comments

One of the first pieces of advice you?ll likely run across when you are looking for help getting out of credit card debt?is to quit using your cards immediately.

This is excellent advice and should be followed to a T. Some suggest cutting up your cards and canceling your accounts as ways to help you stop swiping plastic so you can get out of debt. Both of these options seemed a little harsh and maybe even illogical to me, so I didn?t do either one of these things to make myself stop using my credit cards. Instead I?ve tried a combination of several different ideas.

Here are four ways to stop yourself from swiping credit cards so you can get out of debt without doing anything too drastic.

Freeze Your Cards

One idea I haven?t tried but I know a lot of people have is to freeze your cards in a block of ice to help you avoid using them unless absolutely necessary. This will really test your willpower as you will have to allow the ice around your credit card to thaw before you can put it in your wallet to use it at a store.

The only downside I can see with this method is that you might still be able to use your credit card for online shopping if you can read the card number through the clear ice.

Leave Your Cards at Home

To help myself avoid using my credit cards for impulse purchases while I?m out and about, I simply leave my cards at home. I keep them in a safe place and only take one with me if I specifically have to use it and it makes logical sense to use it.

For instance, I might still use a credit card for online purchases that I?ve budgeted for because credit cards tend to offer great security for online shopping.

Hide Your Cards

If you find yourself feeling tempted to take your cards with you and the leaving them at home method doesn?t work, perhaps you can enlist a friend or family member to ?hide? them from you. If you use this method, make sure whoever hides them for you will remember where they are if you need them for some reason. If they have a questionable memory, maybe a note of where they are hidden is a good idea. 🙂

Wrap a Reminder Around Your Cards

Occasionally I find myself wanting to carry a credit card in my wallet ?just in case.? This is usually when I?m traveling. When this happens, I wrap a sticky note reminder around my credit card before I stick it in my wallet with something like ?For Emergencies Only? written on it. This visual reminder is usually enough to help me stay strong and not use my credit card for splurges or impulse purchases.

Why You Shouldn?t Close Your Card Accounts

Finally, I just wanted to include a small note about why closing your credit card accounts, as some suggest, may not be a good idea. Closing your credit card accounts lowers the amount of available credit you have which increase your credit utilization ration.

For example, if you have $5,000 of available credit (the total of all your credit limits) and you have debt of $2,000 you have a utilization ratio of 40 percent. If you close an account that had a $1,000 limit, your available credit will drop to $4,000 and your utilization ratio will increase to 50 percent if you still have $2,000 of debt. This will have a negative impact on your credit score?as a lower credit utilization ratio is important.

A dropping credit score may not be important to you if you do not plan to use credit again, but if you are planning to purchase a home, a car, or something else on credit you want to make sure your score is as high as possible. Even if that?s not the case, some rental companies won?t rent property to you if you credit score is low and even some employers will not hire you based on a low credit score. Just some food for thought.

Have you tried any of these methods to keep from swiping your credit card? How do you avoid using credit cards? Have you chosen to go completely without using credit cards?

Photo courtesy of: stockimages

5 Hidden Benefits of Credit Cards

January 21, 2015 Wise Dollar Credit 10 comments

Credit cards can be a valuable financial tool – when they?re used properly. As long as you don?t abuse the credit line that you have been extended, and make sure you use your card in a responsible fashion, you can enjoy many benefits that credit cards have to offer. By simply only buying things you can afford to purchase, and not thinking of your credit card as free money, you should be able to steer clear of getting yourself into trouble and racking up debt.

We often hear about the dangers of using credit cards but we don?t hear as much about the benefits of having a credit card. With that in mind, I?ve come up with five of the common, yet sometimes unknown benefits of using a credit card.

#1 ? Credit Cards Can Help Build Your Credit Score

Having a good credit score can help you to get approved for loans, get better terms on those loans, and much more. It is in your best financial interest to have as good of a score as possible, and using and paying off a credit card on a regular basis can help to build your credit score as time goes by. Simply use your card periodically, and make sure to make your payments on time each month.

#2 – Earn Rewards

This is one of the more obvious benefits of credit cards, though many don’t take advantage of it. Many credit cards include some kind of rewards program through which you can earn points that are redeemed for goods, cash, travel, etc. You can even take this a step further and churn credit cards so you can earn free trips. I will say though that churning is not for everyone and that is ok. That is especially the case if you?re in debt or are tempted to overspend when having too many credit cards. That said, if that?s not an issue for you then a rewards credit card can be a great way to get something back for spending you might already be doing.

#3 – Protection

Again, this is a feature that varies from card to card, so make sure to check the fine print on any card you apply for. Some credit cards offer forms of protection such as rental car insurance, travel insurance, and more. Find out what your card has to offer so you know that it is available if the need arises. Like with rewards, the protection features alone shouldn?t be the deciding factor in your card selection, but it is a nice feature to have available in the event you may ever need it.

#4 -?Price Matching

There are many retail stores out there that offer price matching, but many don’t know that some credit card companies offer the very same service. This is another one of those areas where you’ll need to read the fine print of the disclosures but is a great benefit to have if you can get it. The price matching will very with regards to the amount of time as well as to the amount you can claim each year but can be a nice little way to get some sort of refund on?a given item.

#5 ? Concierge Services

This is one that is going by the wayside somewhat, but there are still credit cards that offer concierge services. This can range from something as simple as helping with dinner reservations to that restaurant you want to try out, to concert tickets, to travel agent type services and much more. We?ve had a card like this in the past and loved being able to take advantage of it when we had need. As many cards don?t offer concierge services any longer, you?ll want to check the fine print to see if they do and what it covers.

What other benefits can you think of to using a credit card? Besides rewards, what?s the main reason why you use a credit card? Have you ever had a card that offers concierge services?

Photo Courtesy of: Kaiyan

5 Tips for Resisting Impulse Credit Card Purchases

November 19, 2014 Wise Dollar Credit One comment

The problem with impulse shopping, well there are?more than just one problem, is that the unplanned spending adds up quickly.?You know it?s not the smartest thing to buy that seventeenth pair of earrings at the checkout, or those end of season boots don?t you? Yet you get home after your quick trip to the store?and find these ?no-no? items have somehow found their way into your house, and the charges have magically appeared on your credit card statements. Having gone through paying off debt myself, I know the challenge it can be to avoid impulse spending on a credit card and below are some tips to counteract that desire to give into impulse spending.?If you have gotten yourself in hot water with your credit card, you may need to contact an expert debt solutions provider such as Debt Rescue.

Waiting Period

Cooling off periods are common enough when it comes to almost any kind of contract these days and there?s no reason why you can?t enter into a contract with yourself. Give yourself a cooling off period. Be tough; try 30 days. If there?s anything you?re tempted to impulse buy on your credit card, make yourself a deal: hold off for 30 days. If you still want it by then, you can get it – assuming you have the funds to do so of course. 🙂 Chances are, in 30 days you won?t even remember which online shopping site you were on when you saw it.

Leave The Credit Cards At Home

This is one of the easier ways to avoid impulse spending on your credit card. Having the credit card in your wallet will only tempt you if you’re struggling with impulse spending. Leaving the card at home will automatically remove that temptation as you can’t use it. Don’t allow yourself to think that you’ll only use it for emergencies as that only brings about the possibility of talking yourself into spending. Simply put, if you don’t have your card on you then it can’t be used.

Make It Easy To Resist

If you find yourself whipping out your credit card every time you go shopping, avoid them. Make this easy for yourself by having your groceries delivered. Once you?ve set this up online, you?ll find you?re far less likely to stray from your shopping list when your grocery run is virtual. Having it delivered means you won?t spend time at the checkout, and be tempted to spend on small items you don’t need.?You don?t have to do it forever; just until you?ve got your impulse buying under control.

The Real Cost

Change the way you think about what you?re spending. Instead of telling yourself ?that?s only $9.99 ? and on sale, and I could use one…? try reminding yourself how hard you had to work to earn that money. How many minutes? Before tax? How many customers did you have to serve, or papers did you have to file, or presentations did you have to deliver? How many hours did you sit in traffic to get to work to earn that cash? Understanding exactly how much of your blood, sweat and tears went into your pay packet makes it easier to be more selective about where that money goes.

Plan Your Spending

Lists are a good way to keep your focus when you do have to go out and spend money. If you need to head anywhere to buy things, even clothes, make a list ? and stick to it. Discipline is the key.

Impulse purchases may not seem like a big deal at the time, but they can add up quickly If you are having trouble resisting impulse credit card purchases, it?s time to get tough with yourself. With a few strategies and some self discipline, you?ll soon be back on track.

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