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7 Credit Card Management Tips for Big Purchases

Credit card management tips

Do you have a credit card management strategy? Maybe you use your credit card once a month and pay it off. Maybe you use it to purchase daily necessities or maybe you use it to make big purchases.

Have you ever heard of someone making an incredibly expensive purchase on their credit card and thought to yourself “Why would they do that?” Making expensive purchases on your credit card can cost a lot of money in interest charges and although they may seem outrageous the truth is there are some benefits. Here are seven big purchases and the reasons why you may (or may not) want to charge them on your credit card.

A House

Yes, it’s true. Some people actually use their credit card to purchase a home. If you don’t have the savings to write a check for your down payment, why not use your credit card? New purchases with credit card checks can sometimes have a lower interest rate than swiping your card. If so this could be a smart credit card management tip.

Your College Education

Believe it or not, people do pay for their college education with their credit card. Unless your credit card is at 0% for the next four years it might not be a great idea to charge your college education. Interest on tens of thousands of dollars can accumulate very quickly and student loans are a more economical option. The odds of a college freshman being approved for a credit card with a limit of $50k to $100k is probably slim to none.

A New (or Used) Car

Some people shop around for car loan rates, some people take advantage of dealer pricing and some people buy their car on their credit card. It may seem silly but just think of all the rewards points. If you have the money to buy a car and the availability on your credit it may be wise to charge it and pay it off immediately to gain rewards points and avoid interest.

A Brand New Boat

A boat -- just like a car -- is a depreciating asset. This is not the best credit management strategy because your debt is greater than the value of the asset -- and that’s never good. The technical term is negative equity and you don’t want it.

A Pet

Sometimes high credit card limits lead to impulse purchases. Buying an expensive pet is never a good idea because there are ongoing costs involved. Purchasing and owning a pet is not a one-time expense so while you’re paying off the purchase price you also have to budget in ongoing monthly costs such as food and vet bills. Those expenses can quickly add up.

Your Bachelor(ette) Party

Buying an extra long weekend vacation for you and your closest friends is not the best credit card management tip. Why? Because when you’re on vacation you probably (like many people) spend money in ways you normally wouldn’t. The debt that happens on vacation doesn’t stay on vacation, it comes home with you. You don’t want to start your happily ever after in debt.


This is a major no-no when it comes to credit card management. Some credit cards offer extended warranties when it comes to electronics but more often than not electronics are not a necessary purchase. Before you swipe your credit card think of the want vs. need. If you don’t need it then save yourself some money and don’t buy it.

Image Source: Pixabay


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