I know people who do not own credit cards coz they believe it’s inherently evil. And it can be. Credit cards have extremely high interest rates if you miss the payments. Getting cash out from a credit card lagi teruk. That one worse than loan shark man. Does this make them bad?
No. Like all things, responsible use is key. I have never paid a single cent in interest on my credit cards and I earn a lot in cashback and rewards. In fact, I usually only withdraw RM300 in cash every month and my parking alone costs RM138! The vast majority of my expenditure is met by credit cards and eWallets. I have a system on which to use, depending on benefits.
Let me ask you something. If an Ah Long allows you to borrow money interest-free, so long as you pay everything back before a predetermined time, would you go for it? What if that loan shark offers you various incentives for using his credit facility? You can enjoy free alcoholic beverages at his pub, complimentary entry into his feng tau disco, unfettered access to the women of dubious repute at his massage parlor – the more you borrow, the better the kickbacks. What then?
Tempting isn’t it? That is essentially what a credit card offers, except it’s 100% legit and above board. No happy ending massages in the list of rewards here. And no one to involuntarily secure your front gate with a thick chain and strange padlock if you fail to make payment. No red paint bukkake on your beautiful house façade or broken car windows with threatening missives under your windscreen wiper to contend with.
I personally have two credit cards I use – Maybank FC Barcelona Visa Signature and Maybank Visa Signature. I use the former for all spending except overseas, grocery stores and petrol stations. The latter is reserved for groceries and petrol above RM20 (minimum RM1 cashback) and overseas spending. I personally prefer cashback credit cards to travel points. As Najib said, cash is king.
I pay off all my statement balance on time before the due date so I never get charged interest. As an added benefit, I get credit interest-free and only need to pay the balance once a month! This allows my money to remain in my high-interest savings account or in various short-term stocks until near the due date. #winning
Shh! Hear that? That’s the sound of your money working for you!
Credit cards are excellent for:
- Letting your money work for you till the statement balance due date
- Getting those deliciously sweet cashbacks and points
But only if:
- You spend within your means and have enough money to pay it off every month
- You burn the statement due date into your mind and pay it off before then
You should never spend money you don’t have. My purchases are essentials which I would normally pay cash for, so all cashbacks are a bonus! Maybank Visa Signature offers 5% cashback for grocery stores and petrol, which is like having a 5% discount all the time off the listed price!
I love it.
This is not a #sponsored post ah, limpeh’s gang not big enough for that yet, but please bookmark this blog, like DAMNCHUN on Facebook and one day we’ll get there. I merely use Maybank coz that’s my primary bank account and I have yet to find a better credit card for my needs. There are downsides to Maybank credit cards, namely no cashback or points for eWallet reloads.
Do your own research among the credit card offerings and choose the one best suited for your needs. These small cashbacks will add up in the long term.
Take the small wins and keep hustling, financial gangsters.
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