This Kind of Payment πŸ’Έ Horribly Sabotages Your Credit Card πŸ’³πŸ’£ ...

Even if you like the convenience of pulling out your plastic, there are times when you shouldn't use a credit card. A credit card is an excellent tool for establishing your credit history, or rebuilding bad credit. But despite the popularity of plastic, there are times when it doesn't make sense to use this method of payment. Here are seven situations when you shouldn't use a credit card.

1. Buying a Money Order

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Whether you don't have a checking account or you simply prefer money orders, this is a time when you shouldn't use a credit card. Unfortunately, your credit card company will view a money order purchase as a cash advance. And since cash advances carry a higher interest rate than standard purchases, using your credit card to pay for a money order increases how much you spend.

2. An Expensive Vacation

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If you want to take a dream vacation, using a credit card might be the only way to afford a trip. Unfortunately, using your credit card to finance an expensive vacation creates more stress than excitement. The vacation eventually ends; and when you come home, you’re stuck with a ton of credit card debt that might take years to pay off.

3. An Impressive Wedding

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Unfortunately, there are no guarantees that your union will last forever. And if you put an expensive wedding on a charge card, you might end up paying for your nuptials months or years after the wedding ends. It's a sad statistic, but 1 in 2 marriages in the US end in divorce.

4. Mortgage Payment

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If your bank allows mortgage payments with a credit card, this might be tempting, especially if you want to build credit card reward points. Unfortunately, when you put a mortgage payment on a credit card, you can potentially increase your debt. This might lower your credit score and increase how much you pay in interest. If you decide to use a credit card, immediately pay off the card.

5. Income Taxes

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The IRS will not disappear until you pay what you owe. But instead of using your credit card to settle an IRS balance, speak with a representative to get a payment extension or set up a payment plan. Since the IRS offers low interest rates, the finance charges incurred from setting up a payment plan might be cheaper than the interest rate charged by your credit card company.

6. College Expenses

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You may not want the hassle of applying for a student loan to attend college β€” especially if you have a credit card. However, credit card interest rates are usually higher than the interest rate for a federal student loan. And when you pay tuition by credit card, your credit card company expects a payment every month. However, if you get a federal student loan, repayment doesn't start until 6 to 9 months after graduation. This gives you time to find a job before you start repaying your student debt.

7. Gambling

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Using your credit card to purchase lottery tickets is a no-no. It doesn't matter how large the jackpot gets or whether you think you know the best way to win a casino game. Using your credit card to gamble costs more in the long run. Not only will you lose money, but you’ll add to your consumer debt.

There's no denying the benefits of using a credit card, especially if you're trying to establish credit. But if you use your credit card to purchase the wrong things, you’ll pay more in interest, ultimately increasing the cost of an item.

What other things should you never put on a credit card?

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