Put almost all your expenses there


There are some expenses that you usually can’t charge on a credit card, like your rent or mortgage. And there are also expenses that you can charge on a credit card, but shouldn’t – for example, tuition, where you’ll usually be hit at extra cost for going that route. But if not, it pays to put your other monthly and one-time expenses (like vacations) on your credit card. Here’s why.

1. You will get more cash back

The advantage of credit cards is that they reward you for your purchases. The more items you charge, the more cash back you can earn. It is therefore particularly interesting to invoice the expenses which offer this advantage. For example, some of the best cash back credit cards you give 2x or 3x reward points for refueling, restaurant meals or other specific purchases.

2. You can better track your spending

When you pay some of your expenses in cash, it can be difficult to remember how much you spend in each category from week to week. The advantage of putting most of your spending on credit cards is that you’ll have an easy way to track your spending.

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Don’t know how much you spent on entertainment last week? Just check your credit card statement. Keeping tabs on your spending might not only help you avoid going too far, but also help you set up and stick to one. budget.

3. You can create credit

The more you use your credit cards, the more likely you are to create credit. When you pay for purchases with cash, there is no record of them, while your credit card payments are recorded on your credit report. And if you are on time with these payments, your credit score will increase over time.

How to use your credit cards wisely

Charging most of your expenses onto credit cards is a good idea in theory, but it can also backfire. If you charge too much of a storm, you may not be able to pay your credit card bills in full when they come due. This means you risk racking up expensive interest charges and falling behind on your payments, which would hurt your credit score instead of helping it.

To avoid this, set a budget to follow so that you know how much you can afford to spend in specific categories – and how much you can afford to spend on a monthly basis. At the same time, make a point to check your credit card balance once a week. This way, you will have the opportunity to reduce your spending if you see your balances climbing to an uncomfortably high level.

It’s never a good idea to spend too much on your credit cards and get into debt as a result. But if you can manage your spending wisely, then putting most of your bills on your credit cards could help you earn more cash back, manage your money better, and build a credit history that will provide you with opportunities to save money. more affordable borrowing down the line.

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