We often talk on this blog about the dangers of credit cards, and the lawsuits that overzealous debt collectors file to recover the debt when borrowers get in over their head. However, credit cards are not the evil things they sometimes seem, and in fact they bring many benefits to those that use them. If you have decided to put your credit cards away and opt for cash instead, below are six reasons why you might want to think about pulling out the plastic again.
Credit Cards Are Convenient
Perhaps the biggest benefit credit cards have over cash is the fact that they are so convenient. You can make large purchases, such as a television, without having to carry around a large bundle of cash. Credit cards are small and can easily fit in a wallet, allowing you to conveniently make the purchases you need. Credit cards are convenient in another way, too; even if you do not have the money to pay for something in cash right now, you can still make a purchase with your credit card and pay for it later. As long as you pay your bill in full each month, you won’t pay any more in interest.
Credit Cards Give You Protection
It is a known fact that credit cards give you much more protection than cash. The Fair Credit Billing Act limits a cardholder’s liability for fraudulent charges. The most you will typically have to pay for fraudulent charges is around $50 and the credit card company will absorb the rest. After you cancel the card, the company will send you a new card, usually attached to a different account, to replace your card, and your credit limit.
Cash simply does not give you that same kind of protection. When a wallet and the cash within it are stolen, there is no way to retrieve it and you will simply lose the money.
Credit cards also protect you against purchases that you ordered but they were never delivered, or when a product arrives damaged. When a retailer is not handling an issue satisfactorily, you have a way to dispute it. Credit cards even provide you the protection of auto insurance if you choose to use your card to rent a car. Cash simply does not give you these options and if you have a dispute with a retailer over a product you paid for with cash, you will have to fight it out with them alone.
Credit Cards Give You Spending Ability
When you mainly rely on cash to make your purchases, you are really limited to the amount of cash you have, which means you are limited in what you can purchase. Credit cards, however, allow you to spend as much as you want up until your credit limit, giving you more spending power.
Credit Cards Have Rewards
Most credit cards today offer some form of reward. This may be airline miles, points towards hotel stays and merchandise, and even cash-back offers. Sometimes, it is even worthwhile to use a credit card specifically to get rewards, especially if those rewards are for something you would have purchased anyway. Due to the many different types of reward programs out there, it is important to research the different cards and the rewards they offer to determine which one is best for you.
It is not impossible to earn rewards when you pay for your purchases with cash, but it is more difficult. When paying with cash, you are relying on retailers and other merchants to have their own rewards program. The benefits of these rewards are good, but they are generally limited to the products the retailer carries. The awards programs attached to credit cards are far more versatile.
Credit Cards Help You Build Credit
Your credit score is a very important part of your life. It can determine if lenders will give you a loan, and even if you can purchase a car or rent an apartment. A good credit score can even help you get a better rate on your car insurance. When used properly, credit cards can help you build your credit so these things become much easier. If you can use your credit card to make purchases and pay off your debt each billing cycle, the credit card companies will report the timely payment to credit reporting bureaus, such as TransUnion, which increases your credit score.
It is possible to build your credit score when using cash, but you may have to find more creative ways to do it. For example, you should continue paying your other bills on time as well, including your utility and phone bills. Payments on these bills are also reported to the credit reporting bureaus, but it will take much longer before you see the difference in your credit score.
Credit Cards Meet the Requirements of Retailers
Retailers often require credit cards for certain purchases, such as booking a hotel, renting a car, and purchasing airline tickets. In many cases if you do not have a credit card, you simply cannot use these services or make those purchases. Credit cards do not only give you access to these services, but paying is much more convenient, too. Credit cards allow you to pay online, which is something cash does not. Even if you can pay with a debit card, there is a chance that first you have to put that money into your bank account.
Our Florida Debt Defense Lawyers Can Help
It is true that credit cards have many benefits, but they also have many pitfalls associated with them. The biggest one of course, is that they make it easy for people to get too deep in debt. If you are suffering from debt, and particularly if a collector has already taken legal action against you, it is important to speak to one of our Fort Lauderdale debt defense lawyers today. At Loan Lawyers, we understand that facing a debt lawsuit is scary, but we also know your rights and the defenses to use in your case. Call us today at (954) 523-HELP (4357) or contact us online to schedule a free case review.
For more information about credit card or debt defense please visit our website at: https://www.fight13.com/practice-areas/credit-card-and-debt-defense-negotiation/
Loan Lawyers has helped over 5,000 South Florida homeowners and consumers with their debt problems, we have saved over 2,000 homes from foreclosure, eliminated more than $100,000,000 in mortgage principal and consumer debt, and have recovered over $10,000,000 on behalf of our clients due to bank, loan servicer, and debt collector violations. Contact us for a free consultation and find out more about our money back guarantee on credit card debt buyer lawsuits, and how we may be able to help you.