Credit cards’ extras can help your holiday shopping

It’s the debt-free way of living. Never use credit cards, always use cash and avoid getting sucked into those rewards programs, right?

You’re half-right. If you’re in debt, it’s wise to stay away from credit cards. But if you pay off your cards each month, using them for holiday shopping could have huge benefits.

Check your cards to see what bonuses you might be ignoring, but here are the main benefits.

Product protection: Credit cards will usually let you return items the manufacturer won’t and can include travel insurance of up to $2,000 a year if you have to cancel airline tickets.

“More and more people are shopping online these days with credit cards,” said John McCosh of CredAbility, an Atlanta-based nonprofit credit counseling service. “And a credit card protects you if the delivery is wrong.”

Card protection: If a card is lost or stolen, many issuers will cover part, if not all, of any fraudulent charges. But if you lose a lot of cash, it’s gone.

Extended warranties: Most credit cards automatically extend manufacturer’s warranties by up to a year. Even some debit cards like SunTrust’s MasterCard check card offer protections. They’re especially good, says Whitney Stewart, a SunTrust senior VP, “for big-ticket items like TVs that you want to make sure will keep working for more than 90 days.”

So don’t even think about the extended warranty the salesperson is pushing if you’re buying with a credit card or souped-up debit card. You’re probably already covered.

Free money: Not only does your credit card probably offer a rewards program — such as points, cash back, frequent flier miles — but most also increase bonuses this month. Chase, CitiBank and Discover are offering a 5 percent bonus. Some store credit cards are getting in the act as well.

“Last year I did a lot of shopping with my American Express [card] and reaped tons of rewards from them,” Maryellen Fleming said. The Milton resident had birthdays to buy for, in addition to the holiday this month, so she’s looking forward to a hefty rebate in January. “It’s just easier to put it on the credit cards,” Fleming said.

Improve your credit score: Don’t have a long credit history? “Using credit wisely this holiday season could result in a more favorable deal on your loan if you buy a house or car next year,” McCosh said.

– By Lauren Davidson, Atlanta Bargain Hunter blog

NOTE: I’m out hunting deals for the rest of this week. But if you see a great deal I should know about, email me at ldavidson@ajc.com. You can also follow me on Facebook or on Twitter @atlbargains.

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[...] we’re talking about credit card companies, see my later post on the benefits many credit cards provide to help your holiday [...]