Some purchases should not be charged to a credit card because for credit card issuers they signal you are a client with questionable finances. While swiping a credit card may be convenience for many, credit card companies keep a close eye on all types of charges hitting card accounts. And in fact, using cash takes as much time as swiping a credit card, grabbing a pen, and signing the receipt. That is if we speak of convenience. Cash keeps customers disciplined. When you come to think of it, spending $50 in cash hurts more than charging the same amount to your credit card. But if you are decided on using a credit card, what purchases should you avoid?
Author of Credit Card Nation Robert Manning lists traffic tickets, bargain binges, adult playthings, lottery tickets, and marriage counseling and therapy among the things you should not put on a credit card. Adult playthings are an obvious one – credit card companies regard it as a form of escapism. Marriage counseling and therapy signal to your credit card issuer that you have a relationship problem. This can lead to divorce, which often destroys finances. If you need therapy, this suggests that you are unstable. So, do not let your card issuer know about it.
It should be obvious why traffic tickets, while not a purchase, are on this list. You look reckless and irresponsible. Traffic tickets put a strain on your finances by pushing up your insurance rate. This may be a signal to your card issuer that it will be more difficult for you to make your monthly payments. Moreover, many cardholders who pay traffic tickets with a credit card have defaulted.
Obviously, you should not charge ‘I love my convict’ t-shirts, medical marijuana bonds, or a bankruptcy lawyer to your credit card. Joke aside, do not use your card in night clubs and bars. Charging too many drinks is a sign of relationship stress, financial stress, jobs stress, and even of being irresponsible.
College tuition and mortgage payments are two more expenses on this list. Using your credit card to pay for these shows your card issuer you find it difficult to pay your bills. Moreover, paying tuition expenses or making mortgage payments can be expensive if you use your card. Apply for a college loan or personal loan with better terms instead.
Cash advances are another point in question. Issuers encouraged cardholders to take cash advances in the past, and they are still easy to obtain. However, if you take out a large cash advance and book accommodation in Las Vegas, your credit card company will not look favorably on this. Finally, be wary of buying anything from non-encrypted websites. Only sites that use encryption software are safe to use, and the website address should begin with https:// to indicate this. Avoid using your card at small restaurants and with street vendors that may not adequately protect your credit card details.
Comments on this entry are closed.