Depending on how you use them, credit cards can either be a blessing or a curse. While it’s never a good idea to charge something you’re unable to pay off in full, there are some items that are definitely worth buying with plastic.
1. Appliances And Electronics
Many credit card companies offer complimentary extended warranty programs as well as purchase protection on big-ticket items, such as electronics and appliances. So, if you’ve got your eye on a new washing machine or laptop, it would be better to go with credit. There are cards that also have a price protection feature, which means that if you see the product you just bought advertised at a lower price somewhere else, your card issuer will refund the difference to your account.
2. Travel Arrangements
In terms of peace of mind, credit cards are good for travel, — booking a flight, making hotel reservations, or reserving a rental car, because many issuers offer secondary travel insurance cover, trip cancellation service, emergency services, medical assistance and rental car insurance. There are also cards that let you earn rewards when you use them to cover travel expenses. Such rewards can earn you free flights or hotel stays, discounts on car rentals and vacation packages, free upgrades and access to VIP programs, or even cash back. It pays to shop around for the right card if you’re a frequent traveler.
3. Online Purchases
Though it’s convenient, shopping online also comes with certain risks. So, whether you’re making a one-time purchase or you do all your shopping online, your best bet is to go with credit rather than debt. Credit card companies offer some type of fraud or identity theft protection if ever your information is stolen. You can also prevent criminals to have direct access to your bank account when you pay with credit.
4. Recurring Bills
It’s not a bad idea to link your recurring bills, like utility and cell phone bills, to your credit card instead of your debit card. You get nothing if you pay through your bank account, but you can earn rewards off the purchase if you pay with a credit card, especially if you’re using a cash back rewards card, where you can earn money for every dollar charged to the card. You can also assure that your bills are paid on time and you only have to deal with paying one bill each month.
5. Overseas Purchases
In addition to fraud protection, many credit cards exempt cardholders from paying foreign transaction fees on purchases. This can save you as much as 3% of each transaction. And even if you pay the fee, you can still come out more ahead as opposed to converting your cash.
6. Concert Tickets
Many credit card companies have relationships with certain concert venues/productions that entitle cardholders to first dibs on tickets. Aside from discounts on the tickets’ price, there are also times when credit card issuers offer the opportunity to get VIP access to an event.