Credit Card Offers Guide: What Do Credit Cards Really Do for You?

Flexible Buying Power

• The unsecured credit line provided by credit cards do give you the ability to spend beyond your means. While using this added purchasing power irresponsibly can cause financial problems, having it available can make it far easier to make larger purchases of appliances or be able to pay for emergency vehicle repairs when cash is a little short. When coupled with promotional financing offers sometimes provided by credit cards--such as zero percent interest for 12 months--you can make a large purchase for your home, such as furniture or a washing machine and dryer and not have to come up with the entire amount of cash upfront.
  
  

Cash Flow Management

• When you get into the habit of paying your credit cards in full each month, you take can take advantage of the grace period where the issuer cannot assess interest charges on your purchases. This features allows you to make purchases this month and then pay them off in full toward the end of next month--all without accruing finance fees. You can extend the time you need to pay back the balance by making a larger purchase the day after your prior billing statement closes and then waiting until the payment due day of the next statement to remit the balance due. In the mean time, you can improve your short-term cash position and even earn interest.
  
  

Rewards & Cash Back

• Nearly all credit cards offer some form of loyalty perk, such as points that can be redeemed for gift cards, merchandise or airline tickets or simply a flat cash back reward. We all make purchases every day out of necessity, such as paying for gas for our cars, our monthly cell phone or Internet service bill or even groceries. Pay with your credit card to earn a few cents back on every dollar spent or rack up some bonus points to be used towards a vacation or gift card to your favorite restaurant. You are spending the money anyway--you might as well get something back for it.
  
  

Expense Tracking

• When you make a purchase with a credit card, a record is created and reflected in your billing statement. This includes the amount, the date and where you made the purchase. Some credit card issuers can even categorize your spending by dining out, travel, office supplies, utilities or other categories to give you a breakdown of where you spend your money. This feature can help with establishing a budget and improving your financial situation. With cash, money can fly out of your pocket and you may have no log of where you are spending it.
  
  

Purchase Protection & Other Amenities

• If you buy an item with cash and it is damaged, often times you are out of luck and are stuck having to replace the item with more funds out of your own pocket. Many credit card issuers will offer protection against any form of damage within the first few days after a purchase and allow you to return and get a new one. Credit card also offer other value-add benefits and features. They vary greatly by credit card, but some of these include roadside service for car emergencies, credit score monitoring, concierge service or identity theft insurance.