There are purchases you should always make with a credit card. If you prefer using cash, you might be hesitant to pull out your credit card. This is understandable, especially since credit cards increase the likelihood of debt. But if you use credit responsibly, you can avoid high balances. Here are seven purchases you should always make with a credit card.
1. Online Purchases
Whether you're shopping for clothes, shoes or electronics, online purchases are included among purchases you should always make with a credit card. When you make an online purchase, there's always a chance that the retailer won't send your product, or send the wrong order. And there's no guarantee that the company will correct the order in a timely manner. If you use a credit card, you can dispute the purchase with your credit card company and get a refund.
Some people use a debit card when booking a hotel. However, it is customary for hotels to place a sizable hold on cards for incidentals. If you're on vacation using your debit card, this hold makes a larger portion of funds in your bank account inaccessible. To avoid this headache, always book a hotel with a credit card.
3. Car Rentals
You can use a debit card when renting a car. But if you use your credit card, your credit card provider may include car rental insurance, thus alleviating the need to purchase supplementary coverage from the rental car company. This feature isn't available with all credit cards, and there are limitations. You'll need to speak with your credit card company beforehand to get the details.
4. Airline Tickets
If you have the choice to book an airline ticket with your debit card or your credit card – use your credit card. Some credit cards offer travel protection. If the airline cancels your flight and you're forced to book with another airline at a higher cost, your credit card company might refund the difference. Also, if your flight is delayed overnight and you have to get a hotel room last minute, your credit card company might refund the cost of booking this room.
If you buy electronics or an appliance with your credit card card, you may not need to purchase an extended warranty. Some credit cards automatically include extended warranties with these purchases. This provides additional coverage once the manufacturer's warranty expires.
If you have a rewards credit card, using your credit card to purchase gasoline for your car has its advantages. Many reward credit cards give cashback for every gasoline purchase - sometimes up to 5% cashback. This is an excellent way to accumulate rewards, which can be redeemed for a check or a gift card.
Like gasoline, your credit card rewards program might pay up to 5% cashback at convenience stores and grocery stores. So, use your credit card to pay for your groceries, and you'll soon have enough points to redeem for a gift card, a check or statement credit.
Using a credit card is convenient, but if you want to avoid debt, it's important to pay off your balance in full each month. Also, speak with your credit card company to learn about all the benefits of using your card. What are other purchases you think should be made with a credit card?