Credit Cards

How To Live Without Credit Cards

By David Krug David Krug is the CEO & President of Bankovia. He's a lifelong expat who has lived in the Philippines, Mexico, Thailand, and Colombia. When he's not reading about cryptocurrencies, he's researching the latest personal finance software. 4 minute read

Is it possible to lead a life without a bank account? WHY? In the 1950s, did you ever watch a news clip about flying automobiles, rockets, and the future of the world? Most of it didn’t turn out as planned, but one innovation from that time period has proven to be considerably more valuable than anyone could have imagined.

Credit cards were first introduced to the general public during this time. Credit cards were launched in the 1950s and 1960s by companies such as American Express and the Diner’s Club as a new method to pay for restaurant bills and travel bookings on borrowed money. Credit cards have been around for half a century now, and I’m not sure anyone can picture life without them. I, for one, am unable to do this.

Are you a regular user of credit cards? If you don’t, here are six things to consider and a spoiler alert that can help you live a better life if you put them to use correctly.

1. There will be no theft or loss of your funds.

Losing money is a pain. The last time I had money stolen or lost was when I was 12 years old and a $10 note was misplaced at a bowling alley. Credit cards make it nearly impossible for me to lose my money.

My credit cards were stolen, but the only thing I had to do was phone the card issuer and report their theft, and I didn’t lose a penny. ” As a result of the zero-liability policy adopted by every bank that has ever issued a card to me, your money is secure.

2. They help you maintain a steady flow of money.

The need for money is never as predictable as our paychecks, whether we get paid weekly or monthly. Payment for charges is deferred for 21-25 days after the statement closes, and there is no interest charged if the stated amount is paid in full. Basically, you get a free loan from your credit cards, which is a lifesaver when you’re strapped for cash.

3. They can assist you to improve your credit rating.

They felt they were doing a good thing by not using credit cards while in college because they didn’t have any credit history to show for it. Thanks to a few credit cards, I’ve always maintained an excellent credit rating by charging a few items each month and paying my payments on time. Buying my first home was a breeze as a result.

4. Sign-up bonuses are freakin’ incredible. 

You might get a toaster from your bank or even $100 just for establishing a checking account, but these kinds of incentives pale in comparison to the rewards offered by credit cards. Sign-up bonuses of 60,000 points (worth more than $750 in travel!) have been offered by credit cards I’ve opened.

And what’s the deal with it, then? There isn’t one, in reality. If you fulfill the minimal spending criteria and give them an opportunity to earn your business, they reward you with points or cash back, which I think is well worth the effort.

5. There are a lot of great perks.

With a credit card, you can easily earn between 2% and 5% cashback on all of your purchases.
Honestly, there’s a significant incentive to use your cards to buy both everyday and big-ticket products! Simply said, there’s no reason you shouldn’t be earning rewards with one of the top rewards credit cards.

There are a $1,000 savings potential even for someone who spends $2,500 a month. Credit card incentives aren’t taxed since you’re saving money on a purchase rather than earning it.

6. There are a lot of perks to traveling.

This is one of my favorite perks of credit cards. Standing in line at the airport security checkpoint is something I despise as a regular flier, but I always have the appropriate credit card with me.

It all begins with a credit card from an airline that gives me priority check-in and a speedy TSA Pre-Check queue at the airport security checkpoint. With my Chase Sapphire Reserve, I’m refunded for the $85 application fee. Chase earns extra points!

Every year, I get a $300 travel credit from my Chase Sapphire Reserve, which means they’ll refund me for any travel-related charges I incur up to that amount. Uber and Lyft trips as well as parking garages are included in this category, as well as flights and hotels.

Because most credit cards only give secondary insurance, it’s a huge perk when I use my card to rent a car and receive main insurance coverage. Trip delay insurance lost luggage insurance, and purchase protection is also included in the package. Those perks are wonderful to know about, but I don’t utilize them very often.

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