The cash argument: why you should use your credit card for every Christmas purchase

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Let me put this aside: I have nothing against those who use cash for every purchase. If cash saves you money, or if you don’t trust yourself with credit cards, go ahead and use cash.

Having said that, I to do think you are missing out. Money may feel great in your hand, but it does very little outside of a basic trade. Credit cards, on the other hand, offer perks and perks that can turn a simple transaction into much more. Here are five reasons I use my credit card for every vacation purchase this year.

1. Earn points or cash back

The most obvious reason to use a credit card this Christmas is to earn cash, miles, or reward points on your everyday purchases.

Do not overlook this fact. With inflation rates as high as they have been, you want to earn as much as possible on every purchase. A cash back credit card with a 4% or 5% earning rate can help you pocket money, especially if you match the card to your spending habits. And if your credit card provider offers you bonus rates, such as those found in online shopping portals, you can end up with a large sum of points after the vacation ends.

Certainly, some debit cards can help you earn money for your purchases. But the payout rates on debit cards are generally pale compared to those on Canada’s top rewards and cash back cards.

2. Track your purchases

The cashback and the rewards are exciting, of course. But for those who are budget conscious, credit cards come with another cool feature – they help you track your purchases.

With cash it is very easy to lose track of your spending. After all, unless you keep the receipts, and come on, who does?), You have no way of knowing how much you’re spending. For an in-store purchase, this might not be a problem. Add five department stores, a gas station, a grocery store, and a fast food restaurant, and you could easily forget and lose track of your purchases.

With a credit card, you can just check your credit card balance to jog your memory. Some credit cards even interrupt purchases, helping you see how much you spent on groceries, gifts, and even rent or your mortgage.

A little known fact: Many credit cards come preloaded with valuable purchase insurance. For example, many cards have price protection. With this coverage, your credit card provider will credit you the difference if a product goes on sale after you buy it.

Credit cards also usually come with purchase protection, which covers your purchases against theft and accidental damage. For product defects, your credit card may give you an extended warranty, adding a year or more on top of any manufacturer’s warranty your product may have.

In addition, credit cards often have travel insurance as well. From trip cancellation to baggage insurance, you can cover an entire trip if the conditions are right.

4. Build your credit score

Cash does nothing to improve your credit score. Even a debit card won’t help. If you want to improve your credit score this holiday season, a credit card should be your tool of choice. Pay your bills on time, keep your credit usage low, and you’ll improve your score steadily.

5. Generous welcome bonus

Last but not least, you might be able to land a big signup bonus. Many new credit cards will give you additional rewards or cash back if you hit a spending limit within a certain amount of time. Spend $ 1,000, for example, and you get $ 300 in cashback. It is a very easy way to earn passive income in a short period of time. And, yes, all you have to do is spend money.


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