Are Credit Card Incentives Actually Incentive Enough to Apply?

We know credit cards are dangerous. They can feel like we have permission to buy what we want and worry about paying those charges later. This means some people in a way actually think that at the time of purchase, the items are free because they are not handing over any real money. Yet, deep down we know none of this is true. We not only will pay for these purchases, but we will be paying for the interest as well, if we do not pay the total balance off within the allotted time (usually 30 days).

But are there any good reasons to have a credit card? Many companies are now offering many incentives. Should this give us more reasons to apply? Lets take a look at some reasons for having credit cards and a quick look at some of these incentives.

Emergencies. Yes. Credit cards are great for these. We are short on cash, we need medicine, we need our car fix, our house needs repairs, etc. This is one real reason to have a credit card.

Cash back programs

Use your card at certain stores or on certain items and then you receive actual money in return. Yes, you could receive extra money maybe even hundreds dollar a year. But if you don’t pay off that balance each month, then what you are paying in interest rates could actually mean you are loosing money, instead of gaining.

Also read the fine print of these programs. Sometimes, they have restricted points or earnings you can make. For example, the Discover Gas Card will allow you to earn 5 percent cash back when you spend the first $1,200 dollars on gas or auto purchases. You won’t get that percent on other purchases.

Rewards for using store credit cards

Many stores will offer you 10% off your purchase price if you use their own retail credit card. This is great if you are making a pretty big purchase. Some stores will also allow you to accumulate points each time you use their retail credit card and then after accumulating a certain amount you can receive a discount on your next purchase.

Cash for college

Citi offers a Mastercard that will put 1 percent of your puchase price of certain items into a college savings program.

Charity causes

Yes, credit cards are even trying to get you to help charities, while charging you interest (if you are not careful). Certain charity cards will contribute a certain amount of your purchases towards a charity fund of your choice. Sounds great. Right? It would be, if you can and will pay off those balances. Otherwise, you may just want to give to the charity of your choice, yourself.

Credit cards can really mess up our credit rating, which can have an impact on our financial status for years to come. Be careful when using them and watch to make sure those incentives are really incentive enough for you to apply or use them.