6 Reasons Why I Have Over 30 Credit Cards – Say No To Debit Cards

We love credit cards. The goal of this article is to help you start shifting your spending behavior from cash or debit cards into credit cards.

Credit cards have a sense of security and a sense of protection. If you lose your wallet you’re exposing anything that’s in your wallet to whoever finds it. If nothing happens, awesome, but let’s say this person is ill-intentioned and they want to take advantage of whatever is in that wallet.

If you have cash, it’s gone, forget about getting it back. With debit cards it’s kind of tricky because a lot of people, for some reason, think that debit cards have the same functionality that a credit card and it doesn’t.

1. Credit Cards offer fraud protection

If you have a credit card, credit cards offer fraud protection. If there’s anything in there that is charged as a result of fraud, you can get that money back. Also, you can dispute charges if you see a weird charge on your credit card.

If you buy a product online and two, three days later that product gets shipped to your door and it’s damaged. You call the seller and the seller’s not being cooperative and now you’re very upset because you pay a certain amount of money and this person is not even willing to send you a replacement and it wasn’t even about the money, but hey, wouldn’t be fair for you to just give await your money to someone who is not even willing to accommodate you.

What you can do is that you simply call the credit card company, and you dispute that charge and you explain to them what happened. You need to have proof of the product you bought.

They would reach out to the company, to the seller and within a few months, you should get the money credited into your account. Something like this, it’s very difficult to happen with debit cards and if you pay with cash, forget it.

2. Extended warranty with credit cards

Another perk that you get in terms of protection from a credit card is that you can get extended warranty. Depending on the product or service and also depending on the type of card.

Let’s say for example, you buy a camera today and that camera costs $2,000 and then one week down the road, you see a sale and you see that the price dropped, but now that same camera that you bought for 2,000, it’s $1,500. You can actually call Chase and ask them about the price protection that they have as part of one of the many perks of having that credit card and you can get actually that money back into your account.

3. Credit Card Purchase Protection 

  • Another part that you get under the protection category is that you get purchase protection. For example, you purchased a product and it was never delivered to your door and you checked into the seller’s website and it shows that it’s been delivered but you’re looking all over the place and you cannot find it. Cards like Chase Sapphire Reserve and the American Express Gold Card, they both offer you guarantee for anything that you purchase and that was stolen down the road.

That’s something that cash cannot provide you, that’s something that a debit card cannot offer. Then another perk that you get under protection is travel insurance. Cards like Chase Sapphire Reserve can actually cover you the cost of any luggage that has been lost or any item that you had inside of that luggage and that’s a perk that cash or debit cards cannot offer. The very last one under the protection category is that you can actually avoid having foreign transaction fees.

Debit Cards vs credit cards
Some credit cards allow you to extend the guarantee of the products you buy.

Foreign transactions are actually a big thing, especially if you are a big fan of traveling. What happens if you use debit cards when traveling is that every transaction, even if it was for a cup of coffee, or even if it was for a bottle of water, you will see a certain percentage that goes away on transactional fees so depending on how long you travel, those transactions fees can add up to a lot of money.

They can add up to enough for you to buy a nice meal or maybe two, three meals during that entire trip and that is something that is definitely not worth it.

4. Make money while you spend money

Another great perk about using credit cards is the ability to make money as you are spending money, and there are two ways you can actually do this and that is through sign up bonuses:

  • Sign up bonuses: Let’s assume you apply for a new credit card and then you will probably read a statement that says: if you spend $3,000 in the first three months, for example, then you will qualify to receive $500 worth of points and those are the famous sign up bonuses. With those points, you can redeem them for travel.

You usually get the most out of your points because they’re worth more money if you use them for traveling.

  • You can use them as well as cash back so that you can utilize that money and pay down some of that debt. The key is to utilize that credit card, replace your existing habits of using cash or debit cards, and then use a credit card instead.

Whatever amount of money that you would typically use cash to take care of it, you will use your credit card. Then, at the end of each month, you’re going to take that cash, and then just simply pay down the credit card.

Then, after you qualify for the sign up bonus, some credit cards have excellent perks for you to accumulate extra points. Discover, as an example, depending on the time of the year, they will give you a 5% cash back if you use their card to buy groceries, or you can get 5% cash back if you use that to buy gas for your car.

credit cards instead of debit cards
If you are a person who usually travels, the best thing you can do is having protection against international rates.

Five points, that’s actually very worth it. You can utilize those points just for anything you want. Then, if you were to flip the other side of the coin, because you’re making money, you are also saving money at the same time because if you were to use that cash back to pay down the card, then you’re literally just saving. If you spend $300 and you get 5% of it back, then you’re actually taking a 5% discount in your day-to-day shopping experience.

5. Get access to a lot of things

Another perk that you get by using credit cards is that you get early access to a lot of things. Early access to a lot of activities like concerts, seminars, festivals and others.

  • You build credit. Credit is basically everything you need, it’s everything you need to bridge that gap from where you are today to that financial position that you would like to get to.

For example, credit can help you get a better job, depending on the field that you’re in, credit can help you get access to the car that you want to buy, credit can save you from a rainy day.

If an emergency happened and you don’t have access to cash right away, maybe your savings are not enough but you have excellent credit. By having access to credit, you can actually get access to money that you would normally not would have had in the first place. 

Knowing how to use credit cards responsibly, aside from helping you build credit, can also help you invest in real estate because you can use credit cards to make up that portion that you need as a down payment to invest in real estate. 

At this point, thanks to credit cards, you have built credit and you have demonstrated that:

  • you’re someone who is financially responsible
  • you know how to manage the money
  • you can start building a strong relationship with the lenders.

Having this credit history is very useful for you to get access to more funding so you can start and also expand your real estate portfolio.

6. Protection in case of theft

If you lose your credit card and this ill-intentioned person gets a hold of anything in your checking accounts, you have a thousand dollars and this person goes on a shopping spree and decides to spend all $1,000 that is in there.

It’s going to be very difficult for you to fight it with the bank. You’re going to have to call and they may or may not ever give that money back to you.

You will not get anything back during the process that they’re investigating and the investigation can take a week, a month or more. A month that you will perhaps never see this ever again and imagine if that debit card it’s also linked to your savings account and whatever amount do you have in your savings account.

With a credit card there are no risks, since with just one call you can cancel that card and nobody will be able to use it.

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