4 Things NOT to Buy with a Credit Card

When used correctly, credit cards can be an excellent financial tool, but there are absolutely things not to buy with a credit card. Consumer debt has become a trap for a huge number of Americans. It’s easy to make a large purchase on credit, and then end up paying far more over time because of high interest rates. This can easily accumulate into an unmanageable ordeal, where you struggle each month to make your minimum payments. Let’s take a look at some purchases you should never make with your card.

Things NOT to Buy with a Credit Card

  1. Hospital Bills: Medical debt is the single largest cause of personal bankruptcy in the United States. Healthcare costs can be massive. This is why you should never put them on your card. With the high interest rates on your credit card, such large payments will quickly accumulate into a mountain of debt that might feel impossible to escape. Instead, work with the care provider to develop a payment plan. This will have lower interest rates, and will be far more manageable in the long run.
  2. Education: With $1.3 trillion of outstanding student loan debt in America, it’s obvious that paying for school can be a serious financial burden. The truth is that even student loans are typically a better option than putting expenses on your card. Generally, credit cards will have higher interest rates than student loans. You will also be expected to pay them sooner, and they will have a larger impact on your credit score. If you have the option, never put educational expenses on the credit card.
  3. Weddings: Many people have a grand vision for their wedding. It’s something people dream about their entire lives, but the burden of credit card debt might be a bigger problem for a marriage than sacrificing some luxuries on the big day. Rather than burdening yourself with a large credit card bill, try to think of creative ways to downsize or cut costs.
  4. Credit Card Payments: Many people get into financial trouble and find themselves paying off one credit card with another. It’s best not to do this unless you have no other options. Moving your debt from card to another will only delay your financial issues. Instead, try to develop a budget and stick to it. Cut down your credit usage and pay down your credit cards slowly over time.

Consumer debt can be an awful stress on your life. You decrease your chances of falling into a difficult situation if you don’t make these major purchases with your credit cards. Of course, it’s easier said than done, but the proper role for a credit card is one where you are capable of paying all your bills at the end of each month.

Kevin D. Judd is an D.C. bankruptcy attorney who fights to provide his clients with a path to financial freedom.

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