10 Reasons You Need a Credit Card

7. Interest-Free Money

Between the time you make a purchase with your credit card and the time you actually pay off your credit card, you have a period of time during which you are actually earning money (if your money is sitting in an interest-bearing account) on something that you have already purchased.

8. Merchant Protection

If you pay in cash when making a purchase and the seller doesn't come through, you're basically out of luck. Your other choice is to pursue getting the money back on your own, which will entail both time and money. If you pay with a credit card, however, you have a good chance of getting your money back, and the credit card company will do the majority of the work. You can simply call the credit card company and dispute the charge. The credit card company will then do an investigation and issue a chargeback if they find in your favor.

9. Insurance on Purchases

Many credit cards provide insurance on items you purchase for a certain time period. You must read the fine print of your credit card's terms of agreement (or give them a call) to see exactly what type of protection your credit card provides. This means if something gets broken, lost or stolen shortly after you purchase it, you can often get your money back. If you paid in cash, it would be gone forever.

10. Convenience When Traveling

Traveling, whether in the U.S. or abroad, costs a lot of money. A credit card provides a convenient way to pay for these travels so that you don't have to carry a large amount of cash with you. A credit card can also provide easy foreign exchange when traveling abroad at rates that are typically better than you can get from banks in the same country (although you need to be careful of foreign exchange fees the credit card may charge).

Credit cards can be wonderful financial tools that offer some great benefits for those who use them to their advantage. If you have the discipline to pay off your balance each month, carrying a credit card makes great financial sense.

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