Consumer Comeback Blog

How to Make Credit Cards Work For You

Written by Jeffrey Trull

We constantly hear the horror stories from credit card users: huge piles of debt, massive interest rates, and no end in sight. But is using plastic really all bad?

While it’s true that many Americans have been caught up in consumer debt due to their credit cards, there are plenty of people who take advantage of credit card offers and see real financial reward from them. Yes, there are ways to make credit cards work in your life without owing credit card issuers a dime.

Here are some ways that credit cards can benefit you.

Credit Card Protections

Credit cards offer some protections that cash doesn’t. These include:

  • Fraud protection. You’re typically not liable for any charges to your card that you haven’t authorized. To remove the charge, it’s usually as simple as calling your credit card company. They’ll then typically remove the contested charge and investigate the case. Unfortunately, this type of fraud is becoming more and more common as identity theft is still on the rise, so having this protection can save you a good deal of money and stress.
  • Chargebacks. If you make a purchase with a credit card and the merchant then fails to deliver what was promised, you can ask for a chargeback to your account from your credit card company. This can potentially provide you with a refund when you’ve been scammed or your transaction is disputed with a merchant in some way.
  • Extended Returns and Warranty. A little-known benefit of credit cards is that they often extend the warranties on products that you buy. For example, American Express extends the warranty of some items by up to a year beyond the warranty provided. At no added cost, this benefit adds peace of mind to your purchase.

Build Your Credit Now, Save on Interest Later

One good reason to have a credit card is that it’s one of your best tools to build your credit history and credit score for taking out other loans in the future.

Whenever you apply for a loan for a car or a business, or if you’re looking for a mortgage to buy a house, your lender will scrutinize your credit history. Not only will your credit decide if you get the loan, but your credit score will influence the interest rate you’re offered. The better your credit past, the lower interest rate and the less money you’ll pay to make that purchase.

Of course, simply having a credit card isn’t the only step. If you’re looking to improve your credit score, make sure you understand what will help you and what will harm your credit. Keeping card balances low and making payments on time are crucial steps for building a solid credit history.

No Need to Carry Cash

Carrying cash can be inconvenient. It means that you’ll need to make a trip to the ATM and even pay a fee to use it if you aren’t an account holder.

If you’re carrying cash around, you’ll have no protection if your wallet is lost of stolen. But if you’re dealing with credit cards, that’s never a worry. Just call up your card issuer, and they’ll ship out a new card to you right away.

As mentioned above, if any charges are made on a stolen card, you likely won’t be responsible for paying them, making your financial liability with credit cards cose to zero.


There are now many credit cards with rewards programs for cardholders that have good credit scores. If you’re responsible with how you spend, you can earn various rewards for using your card.

Some cards offer percentage cash back on your purchases, with 1-5% being a typical range. Other cards feature introductory offers that give a large chunk of airline miles or a higher introductory cash back percentage just for opening a new account.

Prevent Overdrafts

If you’re using a credit card, you won’t have to worry about overdrawing on your bank account like you will if you’re relying on cash, checks, or debit cards. Paying fees to your bank can be a huge waste of money if you aren’t careful. Using credit cards allows you to better plan when you transfer money out of your bank accounts.

If you’re ever in an emergency situation where your cash balance won’t cover whatever immediate costs, a credit card can help if you have no other options, too.

Easier to Track Spending

In terms of technology, credit cards and banking are more advanced than ever. Balances and transactions can now be viewed online and may even be imported using different financial apps to help you track your spending and monitor payment due dates.

Compared to cash, credit cards create a huge advantage for tracking your spending because of this new technology. If you’re relying on cash, you’ll have to deal with paper receipts and manually entering purchases. But if you make charges on a credit card, much of your budgeting can be automated using various free financial apps.

0% Financing

Another perk that some credit cards offer is introductory finance rates where you can pay no interest on your credit card balance during an initial term. Of course you don’t ever want to carry a credit card balance month to month, but sometimes extreme situations may require it.

If you’re working to pay off your debt, this can be helpful if you’re able to transfer other balances with higher interest rates (although you’ll often pay balance transfer fees).

Paying 0% can save you money if your only alternatives are higher-interest loans. Still, you need to be careful to pay off your debt before interest rates skyrocket after the introductory period ends. Plus, you’ll still need to make a monthly minimum payment even if you are in the introductory phase.