You can Use Credit Cards to Get Out of Debt!!

You can Use Credit Cards to Get Out of Debt!!

That title appears to be an oxymoron. But, I am not talking about using a credit card to get all of our debt in one place, so that we only have one payment. That could be a precursor to financial disaster. I am recommending using a technique credit card company's use. This technique can help you get out of debt. I am referring to the technique of "a little bit here, and alittle bit there, and soon you have a whole lot", in this case, money. Let me show you something.

I read recently that in 2001, Visa, MasterCard and their issuing banks collected $16.6 billion in credit card interchange fees. By 2006, these fees had increased to more than $36 billion. I am sure it will be even more this year. Wouldn't it be nice to be able to get just part of that?

The credit card interchange fee is a percentage of each transaction that Visa and MasterCard and their banks collect from merchants every time a consumer uses a credit or debit card to pay for a purchase. Because the cost of the hidden credit card interchange fee has to be built into the price of everything a merchant sells, the average American Household pays hundreds of dollars in interchange fees each year. Unlike other costs, the credit card interchange fee is not negotiable. Because merchants have no real option but to accept credit and debit cards, they have no choice but to include the cost of hidden credit card interchange fees in the prices they charge to ALL their customers. This fee averages close to two percent per transaction. That seems like just "a little bit". But, for the average consumer, who has to pay $200 to $300 per year in additional costs for merchandise, this fee is like an invisible 2 percent sales tax on everything we buy. We pay this fee whether we pay with plastic or with CASH.

I think that in the future, we will not use CASH. What? That's right. Think about the use of credit and debit cards, direct deposit, online bill pay, and so on. Then consider how CASH does not leave the trail that so many would like to be able to follow. (That's another topic). For now, we have CASH and can use it as a bargaining chip. We need, if at all possible, to get some of that back. Remember, "a little bit here,....".

How do we get some of it back? Ask for it. Ask the merchant for a CASH discount. If we use plastic to pay, the merchant pays a fee. If we pay CASH, why shouldn't we get what the fee would be as a savings? Just ask for it. Don't be embarrassed. It's your money that you are about to give to the merchant. He won't be in business long if someone doesn't give him money (make a purchase). The worst that can happen is that the merchant refuses to discount for cash. If we can't get a CASH discount, pay with plastic as we still have the means to get "a little bit here."

Many people, apparently, have no business with a credit card. They do not use it wisely and they end up with loads of debt and in financial trouble. I do not recommend getting a credit card if you can't control the use of it. If, on the other hand, you are financially responsible, what I am proposing can result in enough money to make a difference in available money if not a direct reduction in debt.

Many credit cards offer "rewards", "miles", points or something. I recommend cashback. If we are going to get "a little bit here", it should be money. We can pay for the other things with CASH. I recommend using a card that will give you "a little bit here", such as 1% cashback on everything you buy if you can't get a CASH discount. I also think you should consider having a gas credit card.

Have you noticed the increase in the price of gasoline? As if you couldn't. Well, there are gas credit cards that will give you 5% cashback. That is "a little bit" more. At $3.00/gallon it amounts to $.15 per gallon or a free gallon if you put 20 gallons of gasoline in your tank. That 5% savings is on par with the return for government bonds and is definitely worth pursuing. Many of these gas credit cards are restricted to one oil company, such as Shell. I think that is too limiting.

The card I recommend to you is the Discover Open Road credit card. It has a 5% Cashback Bonus on gas and auto maintenance purchases such as oil change, tires, car wash, and etc. It also gives 5% to 20% Cashback Bonus at some top online retailers through exclusive online shopping sites as well as up to 1% Cashback Bonus on everything else. This is definitely the card to consider if you're wanting a little bit here, and a little bit there, so that soon you have a whole lot.

Remember, I don't think credit cards are right for those who don't use them properly. But, if you are financially responsible and want to get "a little bit here, and a little bit there, so that soon you have a whole lot", there are some things you must definitely do. Check out the fine print. Pay off the balance, on time, each month to avoid finance charges. Know how and when you might incur fees and avoid them. Use the card wisely to save (make) money, not spend more.

You can definitely use credit card techniques to pay off your debt. There are many and various ways to manage your money wisely. I will share some of those with you in future articles. This information is given freely so use it as it applies to you. It should not take the place of professional advice.

If you are looking for more ways to get "a little bit here" visit Help to Money.com for articles in the future.