Here in Australia, there tends to be mixed emotions about credit cards and how we use them, with a stigma of sorts surrounding our use of easy credit.
While the likes of Afterpay Touch Group Ltd (ASX: APT) has changed the consumer credit landscape dramatically in the last few years, credit cards still remain an easy and effective form of credit that can have huge upside potential.
Put regular expenses on your credit card
By paying for those regular bills or frequent expenses with a credit card, you can quickly earn the minimum spend required by many cards to access bonus points.
While there are usually restrictions on the types of eligible payments on these cards, a little research can go a long way and see you earn free rewards points for minimal effort and expenditure.
Whether it's the weekly groceries, your Netflix subscription or even your tax liability, there are a number of cards that will let you earn those points and have the closest thing there is to a free lunch in the finance world.
Automate your end of month payment
The big way that credit card providers benefit from your credit card use is through both the annual fees and the interest earned on payments.
The key to maximising your credit card gains is to automate your end-of-month payment to clear your debts on-time, every time.
In doing so, you can safely spend within your means on those items throughout the month, as you would with a debit card, but also have the chance to earn enough points to get those next flights to Bali paid for.
Spend within your means
While some people use credit cards because they need the line of credit, the key to maximising your personal finance game is to get the card because you want to.
By just treating the card as you would your normal debit card, and never spending more than you have at that time, you de-risk your credit card spending and can boost your credit score higher in the process.
In this way, these benefits become easy to rack up and a handy little gift from the credit card provider for very little effort or risk on your part.
Change your credit card provider regularly
Many people get comfortable with their credit card provider or get sucked in by additional benefits that they advertise just before your card comes up for renewal.
The key here is to change your credit card provider regularly to reduce or eliminate the annual fees that you'd pay, which eat into your overall profitability from your credit card use.
By taking into account some of the above, you can beat the banks and reap the rewards of your strong financial setup in 2020 and beyond.
