When Paying With a Credit Card Beats Cash

Paying for something with a credit card instead of cash can be easier for a number of reasons. While it can be difficult to find an ATM when you need it, carrying around a lot of cash can be dangerous, and some things are nearly impossible to buy with cash.

And by “cash,” we also mean a debit card, since money that’s pulled immediately out of a bank account through a debit card doesn’t have as many protections as a credit card does.

Here are four specific instances when paying with plastic is a much better idea than using cash:

Digital Purchases

Ring tones, games on your smartphone or anything else you buy online that’s delivered digitally can be difficult to get a refund on if you pay with a debit card or some other form of digital cash.

If something is wrong with the game you’ve bought, and the app seller doesn’t help you, paying with a credit card will offer more protection than a debit card if you didn’t get what you paid for. Not only will your credit card company help you resolve the issue and put off the charge until the problem has been rectified, they will also contact the seller for help.

Electronics and Warranty Extensions

Televisions, computers, refrigerators and other big-ticket items that come with a manufacturer’s warranty often have the warranty extended for a year when paying with a credit card. Check with your credit card before making a purchse to see if it offers this free service. And only use the card if you can afford to pay off the balance when the bill arrives so that you’re not paying interest on the new TV set you’ve bought.

Undelivered Items

If you’ve used a credit card to pay movers who didn’t fulfill their contract, or the flowers you ordered for mom were never delivered, you can have your credit card company withhold payment until the products or services have been received. In other words, you won’t pay until you’re satisfied. 

Travel

It can be difficult, if not impossible, to reserve a plane ticket, hotel room or rental car with cash. A debit card can be used for some reservations, but a “hold” on the card for the expected total might hurt your ability to withdraw cash from your account or use the debit card elsewhere.

Credit cards make travel a lot easier. They often offer perks such as free checked luggage, protection against trip interruption or lost luggage, and free rental car insurance.