What To Buy With A Credit Card: Tips + What NOT To Buy
In this article we will cover what to use your credit card for and when you should NOT use it.
Credit cards can be great, give a ton of perks, great short term loan, and can help track your spending.
They can also be your credit’s worst enemy. Late payments, overspending, and going into debt can hurt your credit.
What To Buy With A Credit Card – The Truth
The truth about credit cards lies somewhere between these two extremes. As long as you manage them well, they re worth having. But if you don’t completely pay off your bill at the end of the month, you’ll owe an enormous amount of interest on the remainder, usually about 14 percent.
This is what’s known as the annual percentage rate, or APR. Credit card companies also tack on a whopping fee every time you miss a payment, usually around $35. It’s also easy to overuse credit cards and find yourself in debt, as many American credit card users have done.
This isn’t meant to scare you away from using credit cards. In fact, instead of playing defense by avoiding credit cards altogether, I want you to play offense by using credit cards responsibly and getting as many benefits out of them as possible.
Most people are playing the game wrong
I’ve spoken to literally thousands of people who are in debt. Some of them have had tough situations, unexpected illnesses, elderly parents who need support, and surprise expenses. But, candidly, some of them are simply playing the game wrong. They’ve never spent a weekend reading a book on personal finance. They don’t even know how much they owe! Instead of doing the work to aggressively win at the game of debt, they complain. It’s like watching a four-year-old trying to play Monopoly, then realizing they can’t understand the rules (which they’ve never read), getting angry, and flipping the board over. I’ll show you how to win.
When it comes to student loans and credit cards, my goal is for you to stop playing defense. I’m going to show you how to play offense instead. For student loans, make an aggressive plan and minimize the amount of interest you pay. For credit cards, I squeeze every single benefit out of them. Basically I want the credit card companies to hate you, as they hate me.
The best part is how fast you can change your financial life once you switch from playing defense to playing offense with your money.
Frequently Asked Questions About Credit Cards
Is it OK to use your credit card daily?
You can use a credit card for everyday purchases to build credit and to earn rewards for the spending you already do. But remember that you should only use a credit card for purchases you can afford to pay back and make on-time payments to avoid damaging your credit. Remember to check out Credit Card Rules to serve as a guide in navigating credit cards.
How many credit cards should you own?
As long as you can use the credit card responsibly, I highly recommend getting one. They’ll help you build wealth and travel in style.
Follow these rules and you won’t have any trouble:
- Always pay your credit cards in full every month.
- Don’t carry more credit cards than you can comfortably manage, 1-2 cards is a good starting point.
- Once you have a high enough credit score, get one solid rewards card. Use this for all your spending.
…but you don’t have to take the same path as everyone else. How would it look if you designed a Rich Life on your own terms? Take our quiz and find out:
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