For many people, credit cards are simply a payment method. But savvy users take advantage of the additional benefits and services that only credit cards offer. A credit card may give you cash back, free travel, insurance, and other services worth hundreds or even thousands of dollars a year. Check out some of the most significant ways you can save money by paying with credit cards. (See also: 4 Reasons You Should Always Use Your Credit Card to Pay)
1. Get an Interest-Free Loan for a Large Purchase
If you can’t afford something, it’s always best to either forgo it or save up for it before making the purchase. In some cases, however, you don’t have the option of waiting. Your refrigerator dies just when you need a new transmission, or your dentist orders a root canal, stat. If you are disciplined, you can swing free financing on that fridge or dental work by getting a credit card with a promotional 0% APR on purchases. These cards allow you to make new charges and carry a balance with no interest for an introductory period — in some cases, as long as 21 months. After that, your purchases will be subject to the card’s standard interest rate. As long as you make your payments on time and clear your balance within the intro period, you’ll stay out of debt. (See also: The Difference Between Store Credit Offers and 0% Credit Cards)
2. Get a Break From Interest on Debt
Sometimes bad decisions in the past continue to haunt us. Interest that continues to accrue on current debt makes it even harder to make up for those bad decisions. Once you’ve decided to put your financial life back in order and create a debt repayment plan, one of the best tools you can use to help pay off debt faster is a balance transfer to a card offering an intro 0% APR. These offers allow you to take a break from your interest charges so that you can devote 100% of your monthly payments toward paying down the principle. These interest-free offers can last up to 21 months, giving you the time you need to finally pay off your debt. (See also: When to Do a Balance Transfer)
3. Earn Cash Back
Are you diligent about paying off your credit card bill each month? If so, getting a cash back card is a no brainer. You can get a card that gives a flat rate percentage for all purchases, allowing you to get unlimited cash back. Or you can get a card with a higher return for the category that you spend the most in. For example, certain cards offer big cash back rewards for groceries. There’s no reason you shouldn’t get rewarded on your everyday expenses.
4. Get Free Travel
You can score hundreds of dollars worth of free travel by using a travel rewards credit card that gives you points or miles every time you use the card — again, assuming you clear your credit card balance every month. There are different types of travel rewards cards. Some allow you to use rewards to get a statement credit for any type of travel purchase you make on the card. Others let you transfer points to airline or hotel loyalty programs so you can claim award flights and stays. Many offer valuable sign-up bonuses that can get you free flights fast, and money-saving travel perks such as free checked bags and even exclusive airport lounge access. The best travel rewards card for you depends on your travel preferences and habits. Need more advice? Check out our favorite travel rewards cards.
See also: 12 Travel Perks You Didn’t Know Your Credit Card Had
5. Use Free Travel Insurance
Credit cards can be essential when you are traveling not just for their security and convenience, but because they include important insurance. For instance, you can decline your rental car company’s expensive optional insurance and use your credit card’s collision damage waiver policy instead. Some credit cards also have coverage that reimburses you for additional expenses in the event that your trip is delayed or canceled, your luggage is lost, or you’re hurt while traveling. Just be sure to check with your card issuer to find out which policies your card has, and what they cover. (See also: 6 Types of Travel Insurance Your Credit Card Includes)
6. Protect Your Purchases
Many credit cards come with valuable purchase protection policies that repair or replace your purchase if it’s damaged or stolen, typically within 30–90 days of when you buy the item. In addition, most cards offer extended warranty programs that add up to two years to your manufacturer’s warranty. That can save you a bundle on expensive service plans. (See also: How Free Extended Warranties Work on Credit Cards)
Some cards even offer return protection policies, meaning they’ll accept your return if the store won’t. You’ll need to ask to make the return within 90 days of purchase, but that’s still longer than many stores allow for refunds.
All this is included as long as you pay for the purchase with a card that offers these features. (See also: 14 Awesome Credit Card Perks You Didn’t Know About)
7. Get a Price Match
Not only can your credit card protect your purchases from theft or damage, it may also provide price matching services. If the price goes down on a purchase you made (within a specified amount of time), your card may reimburse you for the difference. Different cards have different policies, but usually you don’t have to do anything more than submit a claim. Sometimes the card will even track prices for you and automatically issue you a credit for the price difference. (See also: Citi Credit Cards and Benefits)