You Might Prefer Cash, but Here's 7 Times when It's Better to Use Credit ...


If you're committed to making good financial decisions, you might avoid credit cards and pay with cash. Using cash is one way to avoid costly debt and maintain a good credit rating, but there are times when it's better to pay with a credit card.

1. Booking a Hotel/car Rental

You might have a vacation fund and plan to finance your entire getaway with cash. But if you're booking a hotel or car rental, you're better off using a credit card. In most cases, a hotel or car rental company places a temporary hold on the card, which could be a couple hundred dollars over your actual cost. If using a debit card, this hold reduces the amount of available funds in your bank account. However, you can use a credit card and keep your cash fluid. Also, some credit card companies include car rental insurance as a perk, so you won't have to purchase this extra insurance at the counter.

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