Credit card purchases to avoid -

Avoid plastic for these purchases

According to the U.S. Census Bureau, more than 70 percent of Americans have a general-purpose credit card. But if you don't have the cash in the bank to pay off your purchases right away, a recent Yahoo! Finance article says there are some purchases you should avoid at all costs.

"We counsel physicians, we council stock brokers – people that you would think would generally have a grip on their finances," says financial and marketing executive Bill Staler. "And most do. It's a lack of planning, a lack of understanding [that gets people in trouble]."

Staler, the who is the chief executive officer at LifeSpan, Inc., breaks down some credit card "no-no's." For example, using your card for a gambling spree: Bad idea.

"Our advice is always that if you're going to do something like that, set aside X number of dollars and once that's gone, don't go beyond that," he explains.

Another swipe you want to avoid is college tuition payments. Such a large expense would take a very long time to pay off on a credit card.

"[That is] not in and of itself bad," says Staler. "Where we see problems is when it's the only way to pay and it doesn't get fully repaid, so credit card debt just dramatically increases."

What about for your big wedding day? Should you pull out the plastic to help pay for that white dress?

 "It's something that we recommend people plan for and set aside savings for and not go into debt to finance," says Staler.

With some purchases, there is no going back. Plastic surgery makes the list as the fourth credit card no-no.

Ruth Atha, a counselor at LifeSpan, says that these days you can't bank on future paychecks to make a large luxury purchase.

"No job is secure right now," she cautions. "So, do you have enough money in savings so that if you lost your job, you could take care of the important things like your house and your living expenses and make that payment?"

The  good news is that LifeSpan says they are seeing more and more people playing it safe these days.

"We've seen, I think, a general decline in terms of the purchase of those big-ticket items," says Staler. "I think the economic realities have set in and people are being very careful and cautious about the kinds of purchases they're making."

To recap: Gambling sprees, tuition payments, lavish weddings and plastic surgery all make the list of credit card purchases to avoid. Other big purchases to avoid include tax bills and major vacations – you can work out a payment plan with the IRS to pay your tax bills. Vacations are fine if you plan for them, but just make sure that your trip to the Bahamas doesn't turn into a five-year interest nightmare.

Copyright 2011 America Now. All rights reserved.

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