As children we are forever warned off of using credit cards. Why? Because of the astronomical interest rates where we get sucked into the habit of just spending and spending and spending, however it’s when we start spending money we don’t have do we fall down the rabbit hole.
Well here’s the key:
X2 American Express cards
X2 Visa/MasterCard cards.
Why do I need so many cards you ask? Well. Let me explain.
You need two cards (well two of EACH type really).
One for everyday transactions, and one for direct debit accounts.
This means that your direct debit accounts are consistent and function by themselves. If you don’t use these cards for anything except for the purpose of paying bills, rates, etc then there’s a much less likely chance that they will need to be cancelled.
On the other hand your everyday transaction card is used for just that. It will follow you around on your daily routine and be used for any online purchases.
So the bonus of having your cards structured this way?
If you lose your everyday transaction card or it gets hacked you don’t have to cancel and re-fill out all of your information for your direct debit accounts again.
Now why you have two American Express and two Visa/MasterCard cards is because American Express is often very generous with their rewards schemes, so it’s best to use them when you can as you will most likely get more back for your purchases. On the other hand a lot of retailers don’t accept American Express as they have to pay a higher transaction fee to allow you to use it, and you don’t want to be stuck without a card do you?
So by having two of each it allows you to have security, flexibility and benefit from the reward schemes that all of the credit cards offer.
And don’t forget to renew them every two years. A little bit of hassle will leave you with a lot of reward.
Not only are more cards often introduced with other benefits and fees, but by changing credit cards you can often encounter other specials and offers such as no fees for the first 6-12 months or a sign up bonus of points.
Also do your research and find out just what your credit card will allow you to do, and just what you can use your points on. Some credit cards allow you to pay certain things with your points.
This can include ATO fees and some insurances.
Determine your spending pattern, and what is going to be most advantageous to you.
There are so many options for credit cards, all with differentiating fees, benefits and limits. Comparison is a necessity when weighing up which credit card to go with, and remember, just because you sign up with them does not mean you have to stay with them for eternity!