Credit cards have earned a bad name because it encourages many people to spend recklessly without caring to think whether they can afford to pay for their purchases. Further, the steep rates of interest charged combined with the hefty penalties imposed for late payments can also drive people into a debt trap. However, credit card-savvy people can use their cards strategically to save or earn money through offers, reward points, cashback, and other benefits. A few smart ways to use your credit card:

Avail Balance Transfer Schemes to Reduce Interest Expense

If you have a large balance on a credit card with a high APR, you can avail of a balance transfer offer to save handsomely on the interest expense. If you have a good credit score, you may even be able to get a zero percent APR for as long as 21 months, according to Forbes. However, you should be careful to pay off the entire balance within the offer period, or the amount outstanding will begin to attract the usual high APRs. Do note that almost all cards will charge you a one-time fee for availing of the balance transfer offer.

Interest-Free Purchase

To encourage new cardholders to spend more, some credit cards like the Firestone credit card offer zero percent interest on purchases for a specific period. You can keep using your card to purchase stuff and not have to pay any interest on the statement balance though you will need to pay the minimum amount due every month on or before the due date. This offer can be handy if you are planning to buy a big-ticket item like electronic gadgets, furniture, or home improvement items, or even a vacation as you can pay the charge over the offer period without spending a dime on interest.

Earn Cashbacks

Certain credit cards give you a specific percentage of the spending as a cash reward. Some cards offer cashback on all your transactions, while others have certain expenses that qualify. The typical cashback rate is one percent, which is in addition to the reward points earned by you. To make the best use of this earning opportunity, you must be careful to pay off the entire balance on your card by the due date, or else you will end up spending much more on the interest.

Save On Car Rental Insurance

The insurance amount charged by the car rental company can add significantly to the daily rental amount. However, many credit cards offer free rental insurance as long as you charge the rental to the card and not avail of the rental agency’s coverage. If you frequently travel on business, this feature alone can save you hundreds of dollars on every occasion. However, you should always read the terms and conditions of your card’s rental insurance policy.

Conclusion 

To encourage cardholders to keep swiping their cards, the issuing companies invariably offer attractive programs that give reward points or mileage points every time you use the card. You can redeem these points for purchasing flight tickets or for room nights at hotels.