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Savvy: Credit where credit is due

Credit cards might have brought a new dimension to our financial thinking, but choosing the right one for you is something worth researching thoroughly. 

 

 

Credit cards have brought new dimensions in credit and convenience to our lives.

It’s proved such a relief not to have to lug cash around to pay for everything and it’s such a bonus to be able to afford that great holiday you’ve always wanted without having to wait until there’s sufficient cash in the bank account.

Beyond that, it’s interesting to speculate on the reasons why people choose a certain brand of credit card.

Interest rates are a prime factor and a twelve- or eighteen-month interest repayment holiday is a strong incentive to change to a new brand of credit card, particularly for people who are over-enthusiastic users.

The major credit card brands have been marketed as aspirational lifestyle accountants and some even as status symbols. Dedicated followers of fashion would apparently never be seen in public using anything less than a platinum card.

A wallet full of platinum cards can do such wonders for the ego and the spending power that it’s often a massive unexpected shock when the bill comes in.

In order to promote loyalty to their cards, the brand marketers offer in addition the incentive of rewards. These can take the form of cards with frequent flyer points, exclusive executive services and the ability to use points to purchase a highly desirable selection of luxury items.

In fact, rewards are often the forgotten factor when it comes to choosing credit cards despite the strong case for making them a prime consideration.

It’s certainly worth assessing for example which credit card produces the best frequent flyer returns for the airlines and flights you regularly use.

And which one allows you to recoup rewards or frequent flyer points for your company when used to pay large sums such as payments to suppliers.

In the final analysis, the choice of a credit card should be a hard-nosed decision based strictly on financial factors like interest rates and rewards rather than the acquisition of questionable social status.

When you choose a credit card you’ll find that a diligent study of the costs and the benefits will produce very worthwhile rewards.

 

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