We often use credit cards for their convenience and to buy things even when we don’t have enough cash on hand. But have you ever thought about their other benefits—the ones that may not come to mind right away? There are many such perks to using credit cards, but today, let’s focus on three of them.
Loyalty Rewards
Some people have mastered the art of using their credit cards not only to earn points and cashback but even to grow their wealth through it. I’ve mentioned before how I use my Tangerine MasterCard to accumulate cashback, which I then invest and compound.
If you have a business or make frequent large purchases, you can easily accumulate thousands of dollars in direct cashback or reward points. As long as you can afford to pay the balance in full, you should use your credit card for major purchases.
Which brings us to our next benefit of using a credit card.
Fraud Protection and Extended Warranty
I once ran into a situation where my phone was damaged, but its warranty had already expired. Then I remembered that I had paid for it using a specific credit card precisely because of the added purchase protection it offered.
That coverage came in very handy, saving me from an unexpected expense and reminding me how important it is to know and take advantage of the hidden benefits that come with many financial products.
When making a purchase that costs hundreds or thousands of dollars—and where repairs or replacements are possible—ask whether paying with a specific credit card will offer extra protection, such as insurance or fraud coverage.
Building Your Credit
People with poor credit often ask how they can improve their credit rating. One easy way is to use your credit card wisely. By making purchases and paying them off right away, you build a positive payment history and strengthen your credit score.
Doing this consistently for even six months can make a noticeable difference. It’s a simple way to build or repair credit—especially if you already have a card and were planning to make those purchases anyway.
Credit cards are a double-edged sword: some people master their use and leverage them to get ahead financially, while others misuse them and fall into massive debt.
Used correctly and responsibly, credit cards can be powerful financial tools that help you save money, build credit, and even create wealth over time.