17 Best ways to use my credit cards now

Last updated on July 13th, 2022 at 10:28 pm

Learn how to use your cards to build wealth and improve your credit score. We stopped at 17 best ways to use my credit cards now but there are far more. Do you know the difference between a credit card and a charge card? You will learn this and more by reading this article.

What are the best ways to use my credit cards?

Ok, a debit card is not a credit card so let’s set that aside for now. Some cards are “credit cards” issued by financial institutions. Some cards are gift cards, these are not credit cards. Other cards are charge cards. Charge cards are a form of credit card and the outstanding balance must be paid in full at the end of each month.

Credit cards almost always have a credit limit. Some charge cards do not have a fixed spending limit. An important factor to remember is they all want to be repaid based on the terms you agreed to.

Another important thing to remember is that you can earn reward points (travel rewards)from cards. Always apply for cards with a high credit limit and an award program. Avoid a store credit card unless it’s a Visa or Master Card. It seems that everyone is now a credit card provider.

The best card

The best card to apply for is one issued by a bank unless you use it frequently for airline miles or some other specific reason. Don’t worry about a balance transfer fee or even interest rates. Your new best practices will include paying off the total at the end of every month and avoiding the minimum amount.

You want to use your credit or charge card for your everyday purchases. Remember those points? Just be sure to pay the full balance when it is due. A good reason to use your card for all purchases is one of the benefits of credit cards. You can manage your money by viewing your credit card account online.

Those credit card rewards are a great way to save for a big purchase. Once again, don’t worry about higher interest rates because you will not be paying interest.

Urban Legends about credit cards

There are urban legends and some bad information out there about credit cards that I will hopefully dispel here. 

Start with the idea that the credit card that you have been issued was provided by a financial institution based upon the concept that you will pay them back for its use. This is a basic social contract that we should all live by and that is simply expected like helping a disabled person across the street or opening the door for someone carrying a bundle of groceries. This is simply just done. For those of you who think that late payments are ok, they are not.

A good way to lose your credit cards and end up with bad credit is to fail to pay your cards on time every time. Forget those introductory period cards when you are not required to make a payment for months.

If you fail to pay off the amount due when the introductory rate is over, you will pay all of the deferred interest. If you want to keep that good credit score so you can buy a house, ignore your college friends who tell you to ignore that credit card payment.

Check your credit score and report frequently. You want to look for credit card fraud. A good option is to use the links provided by your credit cards. Some cards will send an email reminding you to check your score. You will be looking for changes, forget the score number it’s probably not accurate. The good news is that if you pay the full amount of your bills on time all of the time, your score will continue to increase.

Credit cards are for convenience

The idea of a credit card today is for convenience. Try to rent a car without one. In some cases, you are used for the second form of ID and you pull out your Visa card. So, you want those hard-to-get tickets to see the Beatles perform, oh, bad example but you know what I mean. You are short on cash and use your card.

Perhaps you are expected to repay the funds and make payments as agreed to every month. You are permitted to run a tab so to speak by making small monthly payments over time. Unfortunately, defaults are so high that banks and others charge obscene interest rates and fees. Yet we need the cards to continue leading a normal life.

Self-control is a key factor in credit card use and I will talk more about it further on. Keep in mind that you should not spend what you can not afford to repay. The credit card companies, banks, and such are entities owned often by shareholders which means you are in your 401k. Want higher returns, pay on time. 

Unfortunately for those of us who pay every month on time, we have to suffer because of people who have no self-control or honor and believe that if they have the card it must be used.

Ok, you have the idea, it’s time for some meat about credit cards.

Accumulate up to $100,000 in available credit

I recommend having sufficient credit cards to create a $100,000 amount of available credit. Then never, never use more than 10% of that total. I recently received a notice from one of my credit cards to check my score. One point that stood out was that my score could have been higher if my card limits were higher. Not the total of all cards but the individual limit.

Considering the limits on most of my cards, I was surprised. It was yet another way to rate creditors who hold credit cards.

Adults should be able to control their spending and use credit cards for everything. If you do this and pay off your cards at the end of the month, every month, you can accumulate points and/or dollars. Using someone else’s money is the way to make money.

You must have the self-control to do this. Having this large amount of credit available will boost your credit score. This is a fact, I know because I follow my advice. Use all cards on a semi-frequent basis.

Use all cards on a semi-frequent basis

The cards must be used on a semi-frequent basis to keep them. Rotate the cards about every other month. I pay for all of my cards online. You can see up auto-pay to avoid being late as well. Occasionally, I will send a payment a few days after I make the charge to get it out of the way. There are many tricks to managing credit cards.

The most important point here is to pay your cards in full at the end of every month. I do not carry a balance on the cards, the interest rates even on the lowest cards are too high to retain a balance and it defeats the purpose of using them to increase your wealth.

Many people advise about credit cards as if everyone is a moron and can not control their spending. It’s true of some people but not of everyone.

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More suggestions:

• Never destroy your cards, if you do, your available credit will drop as well as your score.
• Spread out your acquisition of cards, every six months or so until you have reached the magic number of available credit.
• Do not apply for a card within one year of buying a home and for that matter any large purchase e.g. a car.
• If your credit is good and your limit on an existing card is low, ask for an increase. Typical cards have $5, $10, and $15k limits. If yours is at $5k keep asking over time until it gets to about $15k.
• Use bill pay, set up your cards in bill pay, and use the payment indicator that will notify you when a bill is due. Sign up at the credit card issuer for email notifications of bills due.
• Avoid cards with an annual fee.
• Only obtain cards that pay a minimum of 1.5% back for general purposes.
• Obtain cards and use them for specific things e.g. Sams Club 5% cashback for fuel and use it for fuel only. Amex 4x points for restaurants.
• There is a difference between credit cards and charge cards. American Express is a “charge” card which means that you pay it off at the end of each month (they have a feature to allow extended pay with interest, do not sign up for it). Amex cards are reported to agencies but their balance does not factor into your credit score with the same weight as a credit card.
• Sign up for autopay with your card for electrical, gas, water, trash, and other monthly bills. This way your bill will always be paid on time and you will earn points or cash.
• When applying for cards, go for the highest rewards even though those usually come with higher interest. Remember the interest rate is irrelevant because you will not be carrying a balance.
• Credit card bills are usually on a 25-day cycle, not 30 days, that is by the time you get the bill you will have 25 or fewer days to pay. Go online and determine what the bill is.

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• Swap out cards as mentioned. When you have used your card for the last time that month, you can send a payment by going to their website and determining the amount owed. You can also use their bill pay feature where they take it from your checking account.
• Never use the cash feature e.g. checks they provide because it comes with a 3% or greater charge.
• If you open an account with a no-interest deal for the first year or 18 months pay anyway unless you are one of the rare people who will run upon the balance (keeping a total of all under 10%) and put away the money in an interest-bearing account until the bill is due. Never forget to pay it or you will pay all of the interest from day one.
• Download an app from your bank or credit union that will allow you to track all of your accounts. USAA permits you to enter any mortgage, credit card, savings account, etc. into their app and you can see every day how they are all doing. It’s great if you have many accounts and credit cards this way you can see on one screen what you owe and when it is due. You can also see if there are any unauthorized charges.
• Several cards pay a referral fee to a cardholder who refers another. American Express is one. If you have a friend with an Amex card and you want one, ask them to refer you. Split the referral reward. Do the same with any friends you know.

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Build wealth

I could go on forever with this, but by now you get the idea. You build wealth by using others’ money. This does require self-control and if you have that, you can earn some serious money from your credit card issuer.

Imagine if you paid for example $2,000 per month in bills, gas, food, entertainment, and utilities at between 1.5% and 4% over forty or fifty years how much that would amount to? So why would you use cash? Conventional wisdom would push you away from the use of credit cards for everything because what if you forget to pay your bill or go to Las Vegas and have a spree.

The best cards

Ok, about credit cards and which ones to consider. This article is not sponsored so I am providing this from my own experience since I obtained my first general credit card years ago. Bank of America was either the first or one of the first to issue credit cards. They called it “Bankamericard”. This was before Visa or Master Card. American Express and Diners had been around for a while but were harder to get and primarily for business use.

Since the beginning, there has been actual competition for cards and the card issuers are offering more and varied perks for cardholders. I almost said ownership but remembered that the cards in our pocked are owned by the issuing institution.

There are not many real issuers of cards if you discount credit unions and banks that do not manage cards. Chase, American Express, Citibank, and Capital One are the biggest actual issuers. Other smaller institutions e.g. credit unions work with Visa and Master Card to issue the cards.

To start, there are as mentioned above credit cards and charge cards. The major charge card is American Express and it’s worth having one because the amount you charge is not calculated in the total available credit because it is not a credit card. This gives the holder latitude to spend without being hit over the head with lower credit scores.

Amex is a good “charge card” if you want to pay off the card each month.

Amex also offers a credit element where you can extend your payments with interest but I do not take it. I want to pay that amount in full at the end of the month. Amex gives you points for their regular card and they have many other cards that offer a percentage back but those are mostly credit cards and not charge cards.

The Amex points are great and offer the greatest value with airline travel. I once flew first class on British Airways from Los Angeles to Cairo with points. Had I paid for the tickets they would have cost over $10,000. Had I used the same points to buy merchandise it would have amounted to about $2,000.

On to the others. You want to obtain a card without a fee and one that pays the highest percentage for the things you use the card for the most. I was commuting about 90 miles per day and driving a lot on weekends.

So, I obtained a Costco Visa from Citi bank in part because they stopped accepting Amex (a mistake). They give me 4% back on gas purchases. At the prices charged in CA, that’s a big check at the end of the year.

Some cards pay more than 1.5% per month

I have cards that pay a 1.5% minimum on everyday purchases and use them when Amex is not accepted. This allows me to use all of my cards so the issuers will not take them back. Sams Club has a card as well that offers 5% back on gas, better than the Costco card but there is nothing wrong with having both. Remember the $50k available amount.

If you travel to Europe, you want a card that does not charge transaction fees, there are plenty of those if you look around. Some cards give you lots of points if you shop at grocery stores etc. Be sure to shop around for limits on the amounts you can spend to earn. Some have small limits and that’s ok if you have more cards but if you use one card more than the others, keep the limit in mind.

Use the link below to access not only your FICO score directly from the source but to obtain all three credit bureau reports.

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If you have a business obtain a business credit card

The last point is on credit cards. If you have a small business, obtain a small business card from an issuer that does not report the balance to the credit agencies. Navy Credit is one of those. This way you can use the card for business and run it to the limit and pay it off at the end of the month. Amex is great for this as well.

Yes, you may be one of those people who cannot control credit so if you are, ignore my advice and cut up your cards. Simple. If you can learn to control your urges to spend, you will have a lifetime of convenience and make money.

For readers who need to fix their credit situation and go on to have excellent credit. You need to start with a credit card that works with people who have had issues. Try the Destiny Credit Card link just below this line. It’s good to get a start.

Apply Today! for the Destiny Mastercard from Genesis Financial Services!

We often tell people with low credit scores to get a secured credit card, charge a little and pay it off each month for a few months. Sometimes it moves their score into a range where they can buy a house.

You should check out these articles which are part of a series on Millennial financial literacy called Millennial Financial Resources Series. Click on the ones below that you would like to read more about:

Millennials buying homes near the beach: buy yours now and

23 Easy ways Millennials can improve their credit scores:2022 and

Budget Calculator and Planner: Millennials Need this now

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