When you think of credit cards you might think of terms such as overspending, debt, interest rates, etc. And that’s not surprising, seeing as how much bad press credit cards get. Credit cards get a bad rap because of people who spend foolishly, rack up a pile of debt and then don’t end up paying it.
Don’t be that person. Instead, use credit cards the right way so you can take advantage of the many benefits that credit cards offer. When utilized correctly, they can actually be used as a tool to help you save money.
The good doctor will now share 5 credit card benefits that help protect your purchases.
You’ve probably had the experience where you make a major purchase and then the price drops soon after you bought it. It happens to all of us one time or another. For most things it’s just a few bucks so it’s not that big of a deal. But what if you spent $2,750 on an Panasonic HDTV and then a week later the price drops to $2,499? That’s gonna sting.
You could just return it and then buy it again, but what if you’ve already gotten rid of the box and have been using the product? Well then you’re out of luck there. Strike One.
You could go back to the retailer and tell them your plight and they make take pity upon you and refund the difference. Yeah, keep dreaming. Strike Two.
Hold on! Before you strike out, you should know you have another option available. Your credit card may offer a free price protection service.
Price protection through a credit card offers a reimbursement for the difference in price depending on how long between the purchase and the price drop. Citi is one card that offers a good price protection program. If the price drops at least $25 within 30 days of the purchase, you can request a refund of the difference.
The downside here, if any, is that these price protection programs require you the consumer to be vigilant about watching for price drops after your purchase. You know as well as I do, we never do this. This probably explains why the credit card companies offer this. It’s a great way to promote the benefits of using their credit card and they don’t lose much since few people take advantage of the service.
Typically, most products you purchase come with a one year warranty offered by the manufacturer. The store you bought it at, such as Best Buy, may offer you a costly extended warranty plan. But if you made this purchase with a credit card, you may already have extended your warranty by an additional year at no cost to you.
American Express is one of the most popular cards for value-added extended warranties on major purchases, though many others offer this perk too. Check with your credit card to see if they offer this valuable perk.
If you’ve ever tried to return an item only to have your request denied, you may have wished you knew about the refund protection your credit card offers. Refund protection is commonly used when you’ve missed the 7 day or 30 day refund window, but haven’t yet opened the item.
The protection allows the card issuer to reimburse you the purchase price of the item for an extended period after the purchase. Sometimes this is as much as 90 days later. Your credit card company will require you to ship the item to them first and they’ll issue you a refund after they receive it. Yes it’s a hassle, but it’s much better than being stuck with an impulsively purchased item that you no longer want.
Buying a new and expensive gadget like an iPad can bring you a feeling of joy, but that happiness will soon be squashed if you smash it or it gets stolen before you get the chance to really enjoy it.
But if you bought it with your credit card you may have built-in insurance and be eligible for a full reimbursement of the cost of the product.
The credit card companies aren’t going to give you anything without you jumping through hoops though. So keep in mind there’s a time frame you need to be in to qualify, you’ll need the receipt and if it’s stolen you may need a police report too.
As with many things in life, the devil’s in the details. Read the fine print to see which of these purchase protection perks your credit card offers. If you want a quicker answer, you can google the name of your card or just call the number on the back and ask them yourself.
Doctors general warning: Use credit cards wisely. If you can’t pay for your purchase in full by the end of the month you’ll end up paying interest, negating the benefits of any possible perks you may receive.