Top 7 Tips For Getting The Most Out of Your Credit Card

I feel like when I was growing up, I was always told how bad credit cards were and that I shouldn’t use them. But actually one of the biggest ways that we have saved money is by using our credit card smartly. If you use credit cards responsibly, then it can make a difference in your spending and in how much you’re saving. However, with any tool, it is how you use it that makes the biggest difference. Here is how we have used the perks of our credit card to our advantage to keep more of our money with our top 7 tips for using a credit card.

Top 7 tips for using a credit card and getting the most out of it!

1. Credit card rewards

The biggest tip that I have is to find a credit card that has cash back rewards that fits your lifestyle. In our case, we went with a Chase card that gives cash back in the form of a Disney Gift card…SHOCKING I know. The nice thing with the cashback is that you can earn back a small percentage of what you spend. In our case, it is 1% which doesn’t seem like a lot but adds up over time. We opted not to pay for the upgrade to get 2% back, which I think is about $50 a year. You can find cards that suit your lifestyle such as gift cards, airline miles, etc. Each card will have different stipulations for the cashback, so you will need to read the fine print.

2. Keep focused/keep organized

Try to limit the number of credit cards that you have, and focus on 1-2 cards. If you have more than that, there is a chance that you may accidentally miss a payment or spend more than you were planning to. If you can limit the number of cards, it is easier to track your money to make sure you are staying within a budget but also so you can see if there are areas of spending that can be reduced. Make sure to keep all of the credit card information and organized. This will help to keep track of how much is spent and hopefully prevent you from spending more than you normally would.  This includes setting up spending alerts or balance alerts. Credit cards are a great tool but can be a hindrance if it goes unchecked.

3. Get in the habit of paying more

Get into the habit of paying more than solely the bare minimum as this increases how much you pay in the long run. If possible, pay off the balance each month. This can be difficult to do but if you stick within a budget, it is completely manageable. There are always expenses that creep up over time, which is why its good to stay ahead of your bills as much as possible. If you are able to pay off a majority of the bills, then the interest is less likely to be tacked on further saving you money in the long run.

4. Get that sign up bonus!

This is for if you don’t have a credit card yet or are going to be getting a new one. I don’t recommend going out and getting a new card for the sake of a sign-up bonus. However, if you do need a card, make sure that it has a sign-up bonus. When we got our credit card, we got a $50 bonus for signing up. This helps to quickly earn a little back and can increase the cashback in some cases.

5. Paying for most things with Cash back credit card

This may not apply to everything but it can make a big difference in savings overall. Even if your card is 1% cashback like ours, you can still get back a bit of money. If say you spend about $2000 a month on random purchases, groceries, gas, utilities and get 1% back; that is still $240 back over the course of the year. Obviously the more you spend or put on the credit card, the more you get back. But just be careful to spend your money wisely.  

6. Make frequent payments

If you are willing to make more frequent payments, then you are more likely to keep your credit card bill down. We use our credit card for all our basic spending such as groceries and gas, so we always have a rough idea of how much of a balance we have left. If you are prone to forgetting how much, then get in the habit of paying twice a month. This ensures that you are not paying as much each time and reduces the risk of interest being tacked on to the bill. It can be difficult to get into that habit but once you do, it can make a big difference.

7. Adjust the due date

This tip had been floating around the internet for quite some time and it makes sense. If you have all your bills due around the same time each month except your credit card bill, then you are more likely to forget to pay it. Unfortunately, the credit card companies love that because then you get dinged with high interest rates. By setting your due date for your bill to be around your other bills, you are a lot less likely to forget. This is a simple but distinct way of getting your bills organized. 

As with any tool, a credit card can come in handy if you know how to use it properly. You don’t want to spend beyond your means which does take some self-discipline. Using a credit card is not for everyone, and would not recommend everyone having one. However, if you do use a credit card, then follow these tips for using a credit card to get the most out of it without spending more than you anticipated. Hopefully, you have found these tips for using a credit card helpful and can be used to plan your next trip or just have the extra money in your wallet.

Have any other credit card tips that are helpful? Let us know in the comments below!