What Should You Be Using Your Credit Cards for, According to Experts

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Americans rely heavily on credit cards, whether they are solely using them to build credit or to make large purchases. But many of us are using them wrong and spiraling deeper into debt. GOBankingRates asked over 1,000 people nationwide what the primary purpose for using their credit cards was and over 20% responded to repair or build credit. 

Unfortunately, this may not completely be the best use of credit cards and may only be hurting long-term financial goals. To help get us out of the vicious cycle of minimum payments and maxed-out cards, we asked experts from across the country how we should be using our credit cards. The results may surprise you.

Read on to find out how people are using their credit cards and what experts recommend we use them for.

Finance Large Purchases

An astonishing almost 16% of those surveyed by GOBankingRates responded that they do not own a credit card. If you are really looking to avoid getting into debt, then this might be the best route for you. However, many of our experts agree with the 7% of those surveyed who stated that they use them to finance large purchases.

“Most of the time, purchases of electronics, appliances, travel, or event tickets should all be done with a credit card. Items that cost more are generally recommended to be purchased with a credit card because you’re provided purchase protection from your card in case the item is damaged or stolen,” said Carter Seuthe, CEO of Credit Summit.

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Everyday Purchases/Paying Bills

While 6% of respondents saying that the primary purpose of their credit cards was so that they would not have to pay with cash, almost 16% said they were using them for everyday purchases and just about 14% said they used them to pay bills. While there is a mix of opinions about whether it is a sound idea to regularly make purchases on a credit card, many of our experts said that it would depend on the person. 

Sherry Andrew, a financial coach and founder of Money Mindset Financial Coaching, believes that how a person uses their credit card should depend on a person’s spending habits and whether they can stay disciplined. 

“For individuals who can stay on track with their financial goals, and pay their credit card off every month I recommend using rewards credit cards and using them for as much of your spending as possible,” she said.

Rewards and Perks

A large number of people surveyed (15%) also stated that they used their credit cards because of the rewards and perks that they received. Our experts agreed that in addition to the payment security features offered by credit card companies, people should take advantage of a card’s many benefits including cash back and other rewards.

“Using a robust reward credit card to pay for every purchase or service where credit cards are accepted can help maximize earnings, whether you’re getting cash back, airline miles or points,” said Andrea Woroch, a nationally-recognized consumer finance expert and author.

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“The key to making this strategy work in your favor though is to track each purchase, check in on balances or pay it down every week before it escalates and never carry a balance from month to month where you’re charged interest,” she said.  

Build or Repair Credit

While the largest percentage of respondents (22%) said they were using their credit cards to build or repair their credit, our experts disagreed with this approach.

Jonathan Merry, director at Bankless Times, recommends using a credit card for three purposes: budgeting, payment security, and cash back and rewards. 

“When it comes to budgeting, using a bank card allows you some freedom, but it’s crucial to avoid becoming complacent. Your credit card should be set up and used by how much you can manage to pay off each month,” he said. However, he cautions that “[a] credit card will also have a minimum monthly payment amount, but you should aim to pay more than this whenever you can.” 

Paying the minimum amount each month could result in it taking years to pay off a balance of a few thousand dollars. 

Defer Payments

Only 4% of those surveyed said they used their credit cards primarily to defer payment on purchases until a later date, but many of our experts found this a reasonable use of credit. 

“A card with a promotional 0% purchase APR may allow you to pay off a sizable purchase without accruing interest. Using a credit card to finance a purchase might be a smart move for you if you have faith in your ability to pay off the bill in full before the introductory rate expires,” said Steve Rose, CEO of MoneyTransfers.com.

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“Just make sure to thoroughly understand the terms and conditions of each line of credit you use. Many credit cards provide deferred interest incentives, which means you can be responsible for all interest accrued during the promotional period if you don’t pay your debt in full before the deal expires,” he said.

More From GOBankingRates

Methodology: GOBankingRates surveyed 1,003 Americans aged 18 and older from across the country between September 19 and September 20, 2022, asking twelve different questions: (1) Which of the following is the most important to you when it comes to picking a new Credit Card?; (2) How do you handle your Credit Card bill each month?; (3) Do you know your Credit Score?; (4) What age did you get your first credit card?; (5) What is your primary purpose for using your credit card(s)?; (6) Do any of the following statements apply to you? (Select all that apply); (7) Which credit card fees do/would you hate the most?; (8) How many Credit Cards do you own?; (9) What is your total current Credit Card debt?; (10) How long do you think it will take you to pay off your Credit Card debt?; (11) Have you ever hit the credit limit on your credit card?; and (12) Have you ever charged any of the following to your Credit Card? Select all that apply:. GOBankingRates used PureSpectrum’s survey platform to conduct the poll.


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