Credit cards are so convenient these days, as they give you points, perks, and “buy now, worry later” flexibility. But not every purchase is a wise one. In some cases, swiping your credit card may end up costing you way more in the long run than you ever bargained for. These are 10 times when your credit card should stay in your wallet.
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When you can’t pay off the full balance
If you can’t pay the full balance on your credit card each month, it’s better not to use it at all. Interest charges will accumulate quickly so that $50 meal could cost you $150 or more over time.
For cash advances
Using your credit card at an ATM might sound convenient, but it’s a trap. It’s expensive to use your credit card like a debit card: there are high fees and no grace period, so interest charges start accruing immediately.
At places that charge extra for card use
Some local businesses, gas stations, or utility companies add an extra charge for credit card payments. You can use your debit card or cash to avoid it.
When buying something just for the points
Credit card points are great—but only if you’re not spending money you wouldn’t normally spend. Playing the points system can easily lead to overspending.
To cover monthly bills if you’re strapped for cash
If you’re regularly paying expenses like Rent, electricity, groceries, and subscriptions on credit cards, this is a red flag. You’re headed toward a debt spiral just to stay afloat.
At dodgy or unfamiliar websites
Credit cards are always a bad idea when shopping on sketchy websites that could be scams. If you’re not sure about the site’s legitimacy or whether it has security features in place, trust your instincts and don’t enter your credit card information.
To lend money to someone else
You want to help out your friend or family member in a time of need, but adding their emergency expense to your credit card could end up backfiring on you. You’ll end up paying interest and they may never be able to pay you back.
For gambling or lottery purchases
Credit card companies often categorize this as a cash advance, meaning high interest starts accruing immediately. And like with in-person gambling, it’s easy to get caught up in the moment and overspend.
When shopping emotionally
Whatever your feelings may be (sad, stressed, lonely, or bored), turning to your credit card to make yourself feel better is an easy solution. But those purchases are just going to add up quickly and you’ll probably regret them.
On vacations if you’re already in debt
Travel is easy to overdo and swiping your way through a vacation when you’re in debt will leave you with financial stress long after the trip is over. If you can, plan ahead or wait until you’re in a better financial situation.
Disclaimer: This list is solely the author’s opinion based on research and publicly available information.
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