ArtsAutosBooksBusinessEducationEntertainmentFamilyFashionFoodGamesGenderHealthHolidaysHomeHubPagesPersonal FinancePetsPoliticsReligionSportsTechnologyTravel

Using your credit card for all purchases 2016

Updated on March 17, 2016
Use your credit card for necessary purchases
Use your credit card for necessary purchases

What a bold statement, I know, and this may not be right for everyone. However, if you are good with your finances, or can train yourself to have discipline, then I will show you why using your credit card for all your purchases makes complete sense.

Additionally, when using a credit card, you must only charge what you can afford to pay off each month. If you are using your credit card to make unnecessary purchases and go on unplanned shopping sprees, this approach will not work for you.

Here are reasons why you should use your credit card for all purchases, expenses, and bills (ie electricity, cable, and phone).

(1) You are taking out a free 30-day loan

Your credit card has a 30 day cycle where they calculate your purchases. After your cycle closes, you pay them back after you receive your statement, or bill. Between the time you start charging purchases in the beginning of your statement, and the deadline to pay them back, 30-45 days could elapse. That is a free loan!

  • For example, let's say your cycle is between the 15th and 14th of each month. You start your cycle on 4/15 and it closes 5/14. You bill may arrives one week later on 5/21, and it is due on 5/28. That is 5-6 weeks that transpired from your first monthly purchase and the due date - a free loan.

(2) Reward points

If you charge all of your necessary expenses each month, such as food, insurance, cable bill, gas, etc, you will quickly accumulate points. After a while, those points can be redeemed for:

  • Cash
  • gift certificates, or
  • merchandise.

(3) You will not loose cash

By carrying a large amount of cash to pay for everyday items, you risk it being stolen. If your wallet is stolen, you cash is gone.

If you have large wads of cash in your pocket, you risk it fallen out. If you credit card is lost or stolen - (a) you immediately call your credit card company, (b) they close your current account, and (c) you will quickly be issued a new card. By using a credit card to purchase your everyday items, you will minimize the risk of losing cash, which is irreplaceable.

  • Make sure you have your credit card number and credit card customer service number in a safe place (other than your purse or wallet), so you can call to cancel your card and request a replacement card, in the event your wallet or purse is stolen.

(4) Your credit card bill organizes your expenses

Your credit card bill is an organized summary of your monthly purchases, and easy to track your expenses. When you use cash, you can quickly forget what the heck you spent your money on.

(5) Dispute process and protection

If you charge a service, and the service provider does not deliver, or they provided an unacceptable service, you can dispute the charge on your credit card. For example, let's say you charged $1,500 for a roofing service to replace your roof. The roofers stated in the contract that they would replace any rotten wood with new boards. As you inspected the work, you realized that they are placing the new roof and ice and water shield over your rotten wood!

  • Solution: You take pictures, call the credit card company, and dispute the services. Your credit card company will have you fill out dispute paperwork. Meanwhile, I would suggest that you call another (honest) roofer. If you win the dispute, your credit card company will credit you back your $1,500. Your paperwork is sent to the roofing company's merchant bank, and the money is given back to you.

The best part about this - you save yourself the time and hassle of going to small claims court or hiring a lawyer.

Do you pay off your credit card each month?

See results

Take Aways

The most important thing to remember is - Do not charge what you cannot afford to pay off every month. You need to master the ability to control your expenses. The finance charges will increase your balance by 20 - 30%. Also, make sure to pay your credit card on time! Being late just one day could result in a $39 late fee.

Using your credit card for all of your everyday purchases requires a disciplined approach, and can reward you in the process. Using your credit card is not a free ticket to overspend or spend lavishly, it is a means to organize your finances and expenditures, receive rewards, add buyer protection, and security. $$$


    0 of 8192 characters used
    Post Comment

    • MarloByDesign profile image

      MarloByDesign 2 years ago from United States

      drpennypincher - I totally agree and the caveat here is "if" you pay off your credit card every month!

    • drpennypincher profile image

      Dr Penny Pincher 2 years ago from Iowa, USA

      In my book, I suggested that you can benefit by using a credit card for purchases- and a number of people reacted negatively to this in book review comments. Sometimes people equate using a credit card with spending money you don't have, but if you can pay off your balance every month, you can be better off using a credit card than using cash or checks.

    • wabash annie profile image

      wabash annie 5 years ago from Colorado Front Range

      Great tips! I generally use my credit card for all purchases except restaurants and/or any alcohol purchases and do pay off each month. I can see where my money goes ... also I don't need to carry much cash (unless we are eating out). Never thought about utility bills though. Thanks for writing about this topic.

    • MarloByDesign profile image

      MarloByDesign 5 years ago from United States

      Millionaire Tips - I love your comment about using a credit card for the ease of credit keeping..and I love those points too!

    • Millionaire Tips profile image

      Shasta Matova 5 years ago from USA

      This is great advice - and exactly what I do. I charge everything for the ease of credit keeping, but most importantly, the points they accumulate that earn me cash every year. The key as you said is to pay your bill in full each month, because otherwise the fees will eat up whatever value your points earned you. Voted up.

    • MarloByDesign profile image

      MarloByDesign 6 years ago from United States

      ktrapp - I appreciate your comment about paying your credit card bill off every month. I agree! Also, Delta's Frequent Flier points do NOT expire now (since Fall 2010 when the Delta policy was changed). Very insightful feedback.

    • ktrapp profile image

      Kristin Trapp 6 years ago from Illinois

      Great information for those that don't already do this. We have done this for many, many years (including paying the bill in full every month) and have gotten multiple free airline tickets, and free hotel rooms. We've gone to Mexico, Florida and California all on free tickets. You just have to watch because now some of the airline points you earn expire.

    • MarloByDesign profile image

      MarloByDesign 6 years ago from United States

      Multiman - agreed. You should write some financial blogs! I follow you, so I am waiting... :)

    • profile image

      Multiman 6 years ago

      Yes, and your point is unorthodox and quite true, I use my card for almost everything I buy or pay for and then pay it off before the thirty days.

    • MarloByDesign profile image

      MarloByDesign 8 years ago from United States

      MauKat, I respect your point, but I feel like credit cards are a good way to manage your money (tracking all purchases), but if ones overspends, you are right...not a good idea.

    • MauKat profile image

      MauKat 8 years ago from USA

      You make some very good points, however, if someone has trouble with paying off their debt, or managing their money, this is not a good idea for them!

    • razorblades profile image

      razorblades 10 years ago from Holland

      Thanks for your comment on my page. I like your article, it's a different take on it. I guess my article was coming from the point of people NOT using their credit cards responsibly and unfortuantely there are a lot of people thinking that they are getting money for nothing and get themselves into HUGE amounts of trouble. But I liked your point about a free 30 day loan, I never do that, if I book a flight, I always pay for it before my bill comes in. Maybe that's just me!

    • MarloByDesign profile image

      MarloByDesign 10 years ago from United States

      budwood, thanks so much for your comment. It is so great to hear you pay in the time allotted and enjoy the no-cost loan, that is my practice as well. I also agree with your philosophy to not overspend – great advice!

    • budwood profile image

      budwood 10 years ago from Southern Nevada

      Yes, we use AmEx from Costco for most all retail purchases.  We always pay within the time alotted, so we are enjoying having the continuing no-cost loans.  Having the money in that little piece of plastice is really convenient. Plus, we get a percent or two off of the card's use.  Also, if we have problems with the sellers, AmEx reviews the whole deal. Don't know why eveyone doesn't take advantage of CCs.

      Maybe it's that when some very good buys come up, it's difficult to resist charging more than can be paid off.  But we figure that if we can't get the cash to buy something then, we can't use the card then.   

    • Lissie profile image

      Elisabeth Sowerbutts 10 years ago from New Zealand

      They have in fact purchased the points/rewards Whiney- you pay more for a card which offers them or not - its just I found I was gaining more in rewards than I was paying for the card!

    • Angela Harris profile image

      Angela Harris 10 years ago from Around the USA

      Ingenious, Marlo. If a person can practice self-control, this is a great idea. Congratulations also on best hub.

    • Whitney05 profile image

      Whitney 10 years ago from Georgia

      Marlo- it was a very interesting experience. What those people didn't understand was that they were getting a bonus to something they had already purchased. They felt as though it was their right, not privilege to those points and rewards.

    • Lissie profile image

      Elisabeth Sowerbutts 10 years ago from New Zealand

      Yeah look into it - it varies a lot country by country I think - but it tends not to be overally advertised by the banks - after all you could end up saving money ROTFL! If you can't claim your mortgage interest as an expense by saving the expense you are basically earning a tax free return on your money equal to the mortgage interest rate - which in NZ currently is 10% so well worthwhile! Its also very good for people who have irregular income such as those on commission or with big bonuses!

    • MarloByDesign profile image

      MarloByDesign 10 years ago from United States

      Lissie, interesting, I had never thought about that (having a flex loan facility on your mortgage), as long as there are no fees. I have to research that more. I agree with your comment "The credit card is like a check book - with better record keeping."

      Yes, I love how my credit card statement provides all of my expeditures in an organized fashion!

    • Lissie profile image

      Elisabeth Sowerbutts 10 years ago from New Zealand

      Good hub - its the way Ive used credit cards for years - we even upgraded to a gold card - because although the fee was higher it was still a lot less than the one/way flight to Australia which we routnely earn from the points! The credit card is like a check book - with better record keeping. The ultimate way to do it is to get rid of a check account - have a flex loan facility on your mortgage - pay your salary into the loan at the start of the month and pay the credit card bill from the loan at the end of the month! The trick is of course is to still control your spending.

    • MarloByDesign profile image

      MarloByDesign 10 years ago from United States

      Whitney05, thanks for your comment. Yes rewards are exciting because you are spending money on your credit card anyway, and getting a bonus because of it. It is too bad people were complaining - at least they got *something* and if they did not like the rewards, they always had the option to switch to another credit card/rewards program. It is too bad they lost their gift cards too, that was their fault.

      It must have been one interesting experience for you!

    • Whitney05 profile image

      Whitney 10 years ago from Georgia

      Great point towards rewards. I used to work at call center changing people points for plane trips, gift cards, and accessories. You'd think happy people b/c they bought whatever they wanted with their credit card PLUS they get somethign extra, but all they did was complain. 2,500 pts for $25 that's a rip. Or, I lost my 'gift card, send me another' 'no ma'am I can't do that' 'well I earned the points do it anyway!'