How often do you use your credit card while shopping online? In fact, how often do you even shop online? According to FitSmallBusiness.com in 2020 retail e-commerce purchases were predicted to hit 4.2 trillion dollars, now just think about this statistic, as 2020 has been a year where most people have spent at home.
Since shopping has changed, this too could mean that the way you use your credit cards can change as well. In fact, it’s time to start getting smart and making the most of your cards especially as heavy shopping seasons start to pick up. We sat with our team of experts to cover savvy ways to use your credit union credit card while shopping.
Build Credit While Shopping Online
People often think that spending on a credit card will hurt their credit score and sometimes this is true, but only if you pay the minimum payment or just don’t pay at all. Shopping online actually offers a great opportunity to build credit, but only if done correctly. They best way to do this is to build a spending budget so that you can pay down or pay off each purchase made. What helps to build credit even more is paying back more than the minimum payment; it shows healthy credit card habits and brings down your credit usage, which ups your credit score. By doing this multiple times it will help to build credit and show a strong history of healthy payments.
Team Tropical Pro Tip: Using a credit card to automatically pay your monthly will help to eliminate late payments and avoid overdraft fees. You won’t have to think about your bills during the holiday and you'll also build credit as you spend.
Turn Rewards into Cash or Statement Credits
Rewards credit cards are good, but how you use them is what can make them even better. When using a credit card for purchases switch from a debit card to a credit card to earn rewards. The bigger the purchase the more rewards earned, which comes in handy especially around holidays and birthdays. Rewards earned can be turned into cash, statement credits or even things like travel credits and gift cards. This in turn can save you money in the long-run because instead of making double purchases you are getting something in return and if you think about are spending less too.
Keep Income Up to Date to Maximize Credit Limit
Often time people forget to keep their income up-to-date with credit card issuers. It’s very important to do so, especially if you get a new job earning more money or just haven’t updated it since opening the account. By updating income, (especially if it’s additional income) lenders will be able to appropriately update your credit limit. Most of the time it’s to increase your credit limit which can help you especially when busy online shopping seasons start because it will help to keep you under the 30% of credit limit usage which helps to maintain your credit score.
Fight Fraud Using CardValet
Shopping online can pose a threat to fraudsters, especially if making purchases on unsecured networks in public. For example, if you are picking up a coffee from your local coffee shop and use their wifi to make a purchase it can be very easy for a fraudster to hack data. By using CardValet, you have the ability to turn credit cards on/off after each use. This can help to protect your card especially while on-the-go.
Pro tip: you can also set spending limits through CardValet so you don’t over spend on your credit cards while shopping.
Remembering these tips while using your credit union credit card to shop online can be very helpful especially when heading into busy shopping seasons. Get the most of your card usage, but also use these tips so that you can keep your financials in order.