In today’s world, almost every adult in Canada has a credit card. Although they really should only be used in emergencies, this is unfortunately not the case and consumers use credit cards to purchase goods and services.

The benefits of credit cards

Credit cards have a number of important benefits over cash or debit cards.

• Fraud Protection

Credit cards have a number of built in barriers to help protect against fraud. Possibly the greatest of these is that the bank pays the vendor on your behalf, and then you pay the bank. This cuts down on fraudulent transactions as banks have numerous security checks in place before transactions take place. For this reason, credit cards are the perfect medium for online purchases.

• Improves Credit History Rating

When used responsibly, credit cards are the perfect way to ensure an excellent credit record. This record is the first thing banks or financial institutions look at when you are wanting to make a massive credit purchase, be it a house, trailer, RV or vehicle. The better your credit score, the more chance you will be approved for the final loan.

• Reward Programs

Most credit cards feature reward programs which give something back to the consumer. This is often in the form of point rewards, airline miles, and gift cards amongst others.

Should I pay off the balance immediately or wait for the grace period?

Now that you have made a purchase using your credit card, the question arises – do you pay it off now or take advantage of the grace period given by the financial institution?

In reality, with the advent of internet and mobile banking, using your credit card to make a purchase and then paying the balance on the card straight away is easy!

Why would you do this? Well, you won’t suddenly get a nasty surprise when your credit card bill arrives a month down the line. If you have the money in another account, it really is best to pay for the purchase as soon as possible. It also saves you interest that would be charged on your purchase if you miss the grace period as well as helping to relieve yourself of debt quicker.

If you do miss a payment, you will also be charged penalty fees, a necessary measure by the financial institution, but really a silly way to waste your hard earned cash!

So, paying your credit card balance off immediately is your best option. However, there will be times when you cannot do this. When these occasions occur, study your credit card bill, making sure all the purchases are correct. It also allows you to calculate exactly how much money you will need to allocate from your paycheck to pay your credit card bill. Finally, make sure that you pay before the required payment date. Most banks actually recommend paying at least two to three days before the date shown on

At the end of the day, the way you pay your credit card bill is up to you. You know yourself and ultimately how you work with money. If you are likely to forget to pay and cannot stick to budgets, rather make the payment as soon as you can. If you are meticulous with your money, able to stick to budgets and are likely to be able to pay before the grace period ends, then consider this option.