Credit cards can’t save everybody, in every situation, but they can come in awfully handy in certain kinds of jams.
Not that you need to be told that, and I think most people are aware that credit cards are helpful when it comes to paying for unexpected purchases – as well as getting cash back and other perks, like cell phone protection and car rental insurance. Still, I’ve been reminded several times this summer how much easier life can be with credit cards than without.
So if you’re really wondering if credit cards are all they are cracked up to be, in case it helps anyone, here are five real life situations that you might find yourself in, where I can definitely say, yes, it’s nice to have a credit card.
Credit cards come in handy in the aftermath of a natural disaster
Earlier this year, a tornado visited my little town – it’s almost a village, really – of Goshen, Ohio. The storm thankfully spared my house. We were about two miles away, but it was still a scary afternoon. My 18-year-old daughter was driving home, in the rain and wind, as my 20-year-old daughter, our pets and I headed into the basement after our phones sent tornado alerts.
We later learned of significant damage in the area, but my daughters and I, along with our three cats and Rigby, our 11-year-old mixed breed, emerged from the basement perfectly fine. Our house, though, had lost power, and we heard it might be out for days. And the dinner hour approached.
In the past, in my pre-credit card days I might have attempted stressful math to determine whether we could afford to go to a restaurant since our stove and microwave weren’t functioning. Tight cash flow could have meant cheap fast food or maybe starting a backyard campfire and roasting expired marshmallows (I need to clean out my pantry).
Instead, we headed to a sit-down restaurant, along with half the town it seemed. Afterwards, we stopped at a store for flashlights and candles, and I didn’t stress about those unexpected expenses either. I knew I had plenty of space left before hitting my credit limit, so I could buy now and worry about paying for everything later.
Granted, credit cards won’t always work in the aftermath of a natural disaster – if all of the stores’ credit card terminals are down throughout a community, for instance – but after this tornado barreled through town, my daughters and I had a relatively pleasant evening, and I credit my credit card for that.
Credit cards come in very handy with car repairs
The day after our tornado swept through the area, I took my car into the dealership to have the mechanic replace the headlights and to see why my “check engine” light came on. We discussed doing a few other minor repairs. When I drove away, in a loaner car, I expected to put $500 for the repairs on my credit card.
Instead, I got a phone call that went something like this: “So, your rear brakes need to be replaced. So does your car’s control arm. You need new spark plugs. And if you don’t want your engine to blow up, we really need to get your head gaskets replaced.”
Cost: $6,900, including the tax.
I contemplated buying a new car – mine has over 100,000 miles on it – but as a salesman explained to me, there’s a car inventory shortage right now. So I reluctantly paid for the repairs with some money from my bank account and managed to put the rest on two credit cards.
Ideal? Of course not. But at least I had the the credit card option and I could take a little extra time paying off the balance.
Credit cards are also indispensable for medical emergencies
Maybe a week after getting my car back, Rigby had a health scare. I came downstairs one morning, and there’s no way to delicately put this… but our living room looked like the floor of a badly maintained port-a-potty. Judging from some other piles on the floor, it also looked like our dog was suffering from a terrible hangover at a wild party, if you get what I’m saying.
Because I still had (some) room on my credit card, I got him to the vet without first trying to figure out how I would pay for it.
As it turns out, however, not taking Rigby to the vet would have proven appropriate. I would never have NOT taken him, but after two days of vet exams, X-rays and medicine, and racking up more credit card debt, our vet decided that Rigby didn’t have some sort of terrible disease. He apparently ate something that disagreed with him. In other words, he had a $600 tummy ache.
Still, credit card to the rescue. You might as well rack up some credit card rewards for those medical expenses you have to pay.
Credit cards really help out for those unexpected life moments
Birthdays you forgot about and presents you suddenly have to race to the store to but. Last-minute invitations to go out to the movies or dinner with friends…
It isn’t just that a credit card can help out in emergencies or expenses you must pay. A credit card can provide an assist with everyday expenses that you want to pay.
Granted, I’m a middle-aged divorced dad without much of a social life, and so I admit, I don’t get those last-minute invitations much. But, boy, if I do, I’m ready.
Credit cards can help cover gas and other inflationary items
This summer, gas prices, along with everything else, have gone up. You’ve noticed, right? A credit card, especially one that offers cash back, can definitely help with cash flow.
Of course, you do have to pay these expenses off every month, or at least try to, or you will find that credit card interest eats you alive. That, by the way, is why it’s always nice when credit cards offer lengthy 0% APR periods. You can get into so much financial trouble with credit cards, and I used to regard credit cards a little warily. But that was a long time ago. Instead, credit cards often help me avoid financial trouble.
Whether you’re just starting off in life, or raising a young family and paying for diapers, or contemplating retirement, as you’ve probably noticed, adulthood is pretty much a math equation. No matter your age or stage in life, you’re always going to be calculating, and monitoring, cash flow. And with two daughters off to college, and never-ending slew of expenses, I’m grateful credit cards help me manage it.
Final caveat
In each of these scenarios, paying off the credit card remained a priority. Credit cards aren’t free money even though they can mean free short-term loans. Pay off your balance before they due date and you have taken what amounts to a free loan, but that won’t last if you don’t pay it off (or miss the due date).
Sometimes, the expenses pile up, though, and you may need longer than one pay period to catch up. In that case, you could consider a balance transfer credit card to help bridge the gap. The best option, of course, is a nice emergency fund so you can easily pay for these unforeseen expenses without stress. Even in those cases, using a credit card could mean valuable rewards for down the road, which is a nice way to make lemonade from financial lemons.
