7 Purchases You Should Always Make with a Credit Card

Trying to make the most of purchases should always make? You are in the right place. Below we break it down in plain English, with practical tips you can actually use.

Key Takeaways

• Are you the type of person who prefers to pay with cash or a debit card?
• There are some major purchases that you may be taking risks with by avoiding the use of a credit card.
• Money expert Clark Howard is a proponent of using a credit card for most purchases, with some rare exceptions.

Are you the type of person who prefers to pay with cash or a debit card?

There are some major purchases that you may be taking risks with by avoiding the use of a credit card.

Money expert Clark Howard is a proponent of using a credit card for most purchases, with some rare exceptions.

As long as you’re diligent in paying your credit card bill in full each month, you can enjoy the enhanced consumer protections, benefits, and rewards of a credit card while still avoiding the painful APR attached to credit card balances.

Before you read on, make sure you’re up to date on Clark’s rules for using a credit card. And if you’re in need of a good rewards card, you can check out our researched advice on travel and cash back options.

If you’re on board with the rules and will avoid carrying a balance, let’s talk about a handful of purchases we strongly suggest you make with a credit card.

Purchases You Should Always Make with a Credit Card

There are some minor purchases for which it would be nice to use a credit card to earn cash back rewards. Think a quick stop at the dollar store or a coffee at the local cafe.

Then there are some major purchases for which it’s advantageous to your financial well-being to use a credit card.

Let’s talk about some of those and the reasoning behind it:

1. Renting a Car

One of the most annoying things at the car rental counter is when they try to upsell you on their insurance policies.

Those are an simple “decline” when you are empowered by paying with a credit card that offers these protections as a benefit of card membership.

We have a list of cards that offer Auto Rental Damage Waiver coverage when paying with the card. While most coverage is secondary to your existing auto insurance, there are a few high-end travel cards that offer primary coverage.

Car rental companies are also known for placing sizeable holds on your card during the rental, which could impact your spending power with a debit card.

2. Buying Airline Tickets

There are a few reasons this makes sense. First, using a travel credit card can earn you some excellent points or miles multipliers for this type of purchase. And, if you’re using a co-branded airline credit card, there’s a good chance you will be able to check bags for free and will be eligible for boarding and seating upgrades.

But, as a more practical matter, Clark recommends spending with a credit card as a means of getting travel-related purchase protections. Numerous travel credit cards offer travel insurance coverage for instances like trip delay, trip cancellation, and lost baggage.

Credit cards also give you stronger dispute rights if a flight is canceled or significantly changed.

3. Booking a Hotel Stay

Similar to booking a flight, you may find that using a credit card for a hotel reservation makes things easier and could earn you higher points multipliers on your travel spending. And if you’re carrying a co-branded hotel credit card, you may also find yourself with benefits like room upgrades, early check-in, late check-out, and complimentary meals.

Also, your spending power will be largely unbothered by the significant pre-authorization hold most hotels place on your card for incidentals and potential room damage.

Credit cards also give you stronger dispute rights if there is a mishandled charge from the hotel during your stay.

4. Paying at the Pump for Gas

Did you know that gas stations can place a hold of up to $175 on the card you use to pay at the pump?

And did you know that criminals frequently prey on unsuspecting consumers by attaching hard-to-identify credit card skimmers to gas pump terminals?

Add those two factors together and your wallet is much better protected by using a credit card to pay at the pump (Even better: Use one to tap to pay!). You may also be able to use a credit card to get cheaper gas through rewards programs.

One exception: If you want to get the reduced cash rate that some gas stations advertise to save money on gas, that’s just fine if you are willing to go inside to pay.

5. Furniture, Especially If It Is on Backorder

Clark has been outspoken on this lately.

His major concern is the dreaded “backorder” sale that is common in this industry. Basically, a furniture store will make a “deposit only” sale when you’re on site without having the inventory to fulfill that order.

Your deposit will be charged immediately, but you may wait weeks (or longer) for delivery of your furniture.

If you paid that deposit with a debit card or cash, they have your money right away with little recourse if they are not able to fulfill the order, or, worse … they go out of business.

Clark says to pay with a credit card and watch the clock, because your best consumer protections are good for 60 days when using this payment method.

6. Electronics Like a TV, Phone or Computer

If you pick the right credit card, you may be able to secure an extended warranty on this type of purchase.

Numerous cards automatically extend the manufacturer’s warranty by up to an additional year and add purchase protection against accidental damage or theft for 90-120 days.

Clark has long advised avoiding extended warranties sold by stores or third parties on this type of purchase. You can simply let your credit card’s benefits handle it instead.

7. Major Home Appliance

Buying a washer, dryer, or refrigerator?

Similar to the electronics mentioned above, these purchases may also qualify for extended warranty coverage from your credit card.

Clark says that taking advantage of the warranty and purchase protection benefits on your credit card is a smarter move than paying for a warranty from the retailer.

Do you use a credit card for any of these purchases? We’d love to hear about your experiences in the Clark.com community.

The post 7 Purchases You Should Always Make with a Credit Card appeared first on Clark Howard.

Final Thoughts

Before you check out, double-check purchases should always make against current offers and any coupons you can stack. Small habits like this add up to real savings over a year.

Originally published at clark.com.