You should put everything on your credit card. Everything. Even £3 purchases if you can.
Why, you ask, in a world where credit cards are "evil", would you do such a thing?
If you are a credit card junkie (and there are quite a few of you that are) then here are some reasons why:
- It builds up a great credit rating
By charging and paying off up to thousands of pounds in expenses each month, you can build up a rock-solid credit rating. So whenever you next saunter into your bank needing a loan, you can be accepted right away and probably at the lowest possible interest rates.
- It's quick and easy
Swiping you credit card these days is often as quick as (if not faster than) paying with cash and counting out annoying coins.
- It's great for accounting and spending reports.
If you are not forking out cash or making purchase on your debit card (and most people rarely use cheques), all your monthly spending is nicely bundled into one report: your monthly credit card statement.
- You don't need to carry cash
Trips to the cashpoint are few and far between, as £60 can last month's depending on your spending needs.
- Automated statements are great
Mobile phone bills, utilities, cable TV, you name it. If you can sign up for automatic statements, then do so. It doesn't mean you shouldn't look at each supplier's statement to ensure the charge is correct. But it does mean that on a monthly basis you don't have to worry about paying any bills (other than your credit card) as they are already paid!
- Almost everybody takes Visa
From the coffee shop to the grocery store to online spending to travelling; Visa is the credit card most widely accepted worldwide. And the number one reason for charging everything to your credit card (drum roll, please):
- Frequent flyer miles
Where applicable of course, but if you are charging everything to your credit card, you can collect and redeem miles for everything from fancy dinners to sports gear, to multiple flights all around the world.
So, just for spending money you would always have spent, you can take advantage of all sorts of free stuff. What's better than free?
Money Hospital Note:The trick to a spending plan such as the one listed above is a rock-solid budget. You should never (read: never ever) spend beyond your ability to pay off the bill in full each month.
If you can't do that, then don't even bother having a credit card!