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1 Smart Credit Card Tip Always to Follow

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The credit card industry has seen a shift over the past decade to become more cardholder friendly. In fact, financial protections have been put in place that allow cardholders to be granted one late-payment-fee waiver each year -- if they ask for it. This is a fact that many cardholders don't know, and it's a smart tip to utilize when this situation presents itself.

In the video segment below, The Motley Fool analysts Michael Douglass and Nathan Hamilton discuss one other smart credit card tip cardholders always should follow.

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Michael Douglass: Let's talk through putting travel on your credit card and why it is such a good thing to do, generally speaking.

Nathan Hamilton: Yeah my credit card tip of the day and pretty much for everyday in life is placing your travel purchases on credit and many people know this, it's a no brainer, but it's warrants repeating because there are benefits beyond just the rewards, but speaking of rewards you are going to get premium rates for travel cards because card issuers know that travelers tend to spend a good amount of money on their cards, they have favorable demographics, and they will reward travel credit card holders with 2, 3%, 5% yields on their spending and those are pretty high rates when you compare it to cash back, which is around 1.5% for many cards out there.

Douglass: Additionally, they usually come loaded with a lot of other perks that will benefit you while you're traveling.

Hamilton: Yeah, things like travel accident insurance, in some cases up to half a million dollars. Certainly travel delay, cancellation insurance, which can be huge if you suddenly get sick or something like that right before you go on travel. There's a lot of other opportunities there to really kind of make your life better.

Douglass: Yeah, I've seen it, there's any interesting stat out there that says one in six travel incidences is going to be affected by some sort of delay, be it cancellation, delay, change flight, anything like that. Insurance comes into play very heavily when those scenarios do happen because you can get as you mentioned, those high limits for a cancellation in terms of weather events, anything, that's going to apply for the card, but most people don't tend to think about insurance in their everyday interactions, but when you do have it, you realize like, "Oh thank God, I'm glad that I do have it in this instance," which for travel vacation, whether it's for business, vacation, you're going to happy that you have those benefits backing you. In the very rare scenario that it does result in injury be it loss of hearing, death, anything like that there are very high limits for many credit cards on the market, which sometimes can reach several hundred thousands of dollars to cover you for flying.

Hamilton: Yeah, so basically it's nice to have, particularly if again you're getting it for free right? If you're paying off your balance every month, and you're getting great rewards, and you're getting all these other perks in a lot of ways it's kind of a no brainer. Great tip for the day, thanks Nathan. Check us out at fool.com/creditcards for, well a bunch of other great tips on credit cards.

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