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From reading a few of the articles on this website, you would probably get the impression that it's against using credit cards. Nothing can be further from the truth. As a matter of fact, credit cards, when properly used, can provide anyone with an instant "zero interest, no questions asked loan approval" for 30 days. The trick is in knowing what to use it for.

Let's say you've had an unexpected expense. Your mortgage is due in a few days and you don't have the full amount in the checking account. What do you? Well, if you have a credit card and your next credit card billing date is 30 days away you have no problem! As long as you know you will be able to pay the full amount due on your next credit card bill, use your credit card to pay the mortage bill. Then, the minute you have the money, send in the full payment to your credit card company and breath easy once again.

Just like the mortage bill, if you need to pay your car payment, you can do the same thing. This is a no brainer because paying late on a car payment will definitely affect your credit score in a negative way. So, if the circumstances warrant it and you know absolutely that you'll be able to make the full payment BEFORE the credit card bill is due, then do it.

Okay, those were no brainers. But how about something that is a little more difficult to justify paying with a credit card? How about paying for insulating your attic in your home. How can THAT be considered a wise use of your credit card? Well, lets look at the reasoning behind this. Depending on where you live in the country, an uninsulated attic is a major financial drain. In the Northeast with the cold winters, you'll tend to keep the heat on high just to make up the heat loss through your uninsulated attic. In the summer, when the temperature rises to unbearable highs, you'll turn on your air conditioner to keep you and yours comfortable until night time falls. So, if you insulate your home against the dead of winter and the heat of summer you'll save money on energy costs associated with keeping your home comfortable. Now, unlike a car, you'll be saving money for years to come with this type of use of the credit card.

Is it a Luxury or a Necessity?

Determining when something is a need and not a luxury is a very difficult question. Do you REALLY really need that 52 inch plasma tv? Or how about those expensive rims you've been eyeing for your ride. True, you'll see your favorites soaps better and yes, I agree lowering the radius of your wheels will give you more torquq but the question is, "IS IT A NECESSITY?" If you can't positively absolutely convince an IRS agent that it is a necessity, then I suggest you don't pay for it with a credit card.

Will it Help or Hurt?

Some items paid for with a credit can be used to help you with your income tax return. When it helps your income tax return, you can use your credit card. Charitable organizations and certainly use your help and so can your local church. Just make sure you get the proper form for when you file.

There is nothing more annoying and wasteful as when paying for something at the checkout counter and having the clerk ask, "Woudl you like our extended protection plan? It's only a few dollars more and it will protect your purchase for up to x years." It the product breaks within the warranty period, it's covered. It really comes in handy with a car repair. If the repair fails right after you leave the shop you have the power of a charge back hanging over the repair shop. They'll be more willing to listen to your complaints with one of these babies hanging over their heads. How about a major appliance like a dishwasher? If it's defective, just call the store and tell them the smae thing, that you will charge it back if they don't replace it immediately. Man that's power!

Okay, now that we know when to use credit cards, lets look into when not to use them. Ready? lets go...

Are You Spending Too Much?

This is one of the biggest problems most of us have: OVERSPENDING. Let's face it. We live in a consumption based economy. And the system is finely tuned to get us to overspend. Our favorite show first puts us in the proper frame of mind. Nice warm sofa in our living room puts us in our safe coccoon like safe. We are safe from the outside world. But then, a commercial intrudes in our peace and quite. It is intriguing and entrtaining. Soon enogh it has us living an alternate reality. We are that guy with that cool Harley. Roaring down the road with a cool leather jacket and riding boots. Heck for just 98 dollars a month we can BE that guy!

And the systems have scored another basket against our rational side. Now, we feel like we can improve our life by buying that motorcycle. But once we know this, we can break the hypnotice trance that carefully crafted commercial has placed us in.

I won't say much about impulse buying. But I will tell you its source. Emotions! Yes. Emotions can influence you to make an unneeded purchase. You go to the mall and start cruisng through the different shops and sooner or later your friend will make a comment that could make you spend spend spend. My advise, go to shops with a frugal friend. Don't go with a spendrift and keep those emotions in check.

Okay, you now know the difference between "Good" and "Evil" uses of credit cards. How about their usefullness? What other benefits besides an instant loan do they give you? Well, here are some of them:

If you want to rent a car or cash a check, a credit is essential in proving your identity.

If you carry cash and its lost or stolen that money is gone Honey. But a credit card can be replaced. Plus if you report it lost or stolen within the time limits of your credit card agreement you are only liable for up to $50 of any unauthorized purchases.

If you like tracking your spending, then nothing beats an itemized list at the end of the month. Compare that with cash register receipts.

You all know of consolidating many purchases into one payment. It's called balance transfer.

Although I don't believe it is true, some people believe they can save money when they can take advantage of a good sale.

Have you tried buying something over the phone with cash money? Or how about over the web? Get the point?

Your disputes and claims against a merchant carry more weight because the credit card company will charge back the transaction compared to a cash transaction. You'll get prompt attention from your credit card company.