When should I use, and not, use my credit card for a purchase and why?
As a general rule, use the method that fits the repayment plan. If you will pay over time for a large purchase, borrowed money makes sense, but borrowing, and repaying long-term for short-use purchases is a bad idea. Using a credit card at a restaurant is advisable only if you will be paying for that purchase, in full, on the next bill. Extending a loan for a small purchase and paying for it over many months increases your interest expense and reduces your available credit in the event it is needed later.
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As a general rule, use the method that fits the repayment plan. If you will pay over time for a large purchase, borrowed money makes sense, but borrowing, and repaying long-term for short-use purchases is a bad idea. Using a credit card at a restaurant is advisable only if you will be paying for that purchase, in full, on the next bill. Extending a loan for a small purchase and paying for it over many months increases your interest expense and reduces your available credit in the event it is needed later.
