They can help you make large purchases whenever needed. Besides, with the credit card reward programmes, you can get lots of goodies including free flights, shopping discounts, free travel insurance and special holiday deals.
Even though credit cards are quite useful, you need to ensure that their use will not get you into debt. Consider the things that you should never charge on your credit card:
There is no point in transferring debt from one account to another. Besides, your credit card certainly has much higher interest than your home loan so this will result in higher charges and greater debt. You must ensure that you pay your mortgage instalments out of your monthly income. Generally, they should be your priority. Prepare and stick to a stricter budget if you have to.
If you get medical treatment which is not covered by your plan or you are not covered at all and you have to pay for it out of your pocket, you should not use your credit card for this purpose. In case you cannot afford to pay for the treatment in full right away, you should negotiate a payment plan with the hospital. Most healthcare facilities offer this option. Their repayment plans are typically cheaper compared to borrowing from credit cards.
It is certainly a bad idea to put any money into gambling. The idea of using a credit card for this is even worse. Firstly, the cost is higher because you will have to pay interest. What's more, you can use the card uncontrollably until you reach the limit. Never use a credit card for gambling even if you put down small sums.
If you cannot afford to pay for luxuries such as designer clothing, spa holiday in a five-star hotel, a fancy wedding or a sports car then you should live without them like you did before. Do not use your credit card to pay for items which you do not need as this can get you into debt trouble. If you really want to spoil yourself with a luxury gift, you should save enough money to buy it.
You should not use your credit card for donating money to charities as you can end up paying interest on your donations. The risk of you getting into serious debt is higher if you donate money on a regular basis. Use your monthly income or savings for helping others to ensure that you will not end up in need of help too.