Why Retirees Shouldn't Ditch Their Credit Cards

8 July 19

Credit Cards

These days, having a credit card is useful for more than just being able to buy items with plastic. They are also very handy for buying products online, booking vacations, and earning valuable rewards among other things. Obtaining or keeping your existing credit card can be a very savvy financial loans move when you are retiring.

Purchasing Products Online

Purchasing items online has become the new norm in this day and age, and getting rid of your credit card could leave you without this convenience. This is especially true, as you get older, as you’ll find it more convenient to get the items you need delivered straight to your door. On top of this, booking vacations online can be impossible if you do not have enough money in the bank or a valid credit card. As retirement is often the prime time for you to travel, you don’t want to be stuck at home simply because you got rid of your only means of booking travel accommodations.

Earning Rewards

From points to airline miles to cash-back, credit cards can come with great rewards that you don’t want to miss out on when your retire. Many reward credit cards also come with additional perks that range from travel booking services to receiving an extended warranty on your purchases.

Investment Reward Cards

There are some credit cards that can help you in funding your retirement. These credit cards are called “investment reward cards”, and are designed for people that are interested in utilizing the purchases that they make on their credit card as a way to supplement their existing investment and retirement portfolios. Although you won’t be able to fund your retirement solely on the benefits of these types of cards, you will still be able to gain some pretty phenomenal value, since the investment rewards on this type of credit card from spotloan will increase over time. These types of cards work very similarly to other more traditional reward cards, however instead of earning cash back or points, you will earn a certain amount that gets funneled straight to your retirement account.

Proceed With Caution

It’s important that you do not use credit cards as a way of getting into debt, as retirement is the worst time in your life to find yourself with a bill that you cannot repay. Instead credit cards during retirement should only be a means of convenience and gaining benefits. It is absolutely essential that you pay your balance on your credit card every month in order to stay away from debt during your retirement. Also, credit cards are a great way to add on to your existing retirement fund, but they should not be used as the only source of creating your nest egg.

What to Look For in Credit Cards

When choosing a credit card that works for your situation you should look out for several benefits that it offers. For starters you should attempt to attain a credit card with a low interest rate. From there you should look for credit cards with the best rewards. For example a credit card that allows you to attain the aforementioned retirement investment benefit can aid your financial situation during retirement substantially. Looking for cash back reward cards are also ideal, as you can gain up to 5% cash back with these types of cards. You should also look for credit cards that do not charge an annual fee and do not limit or cap your rewards earnings.

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