If you’re tempted to use a credit card for a big-ticket item like a car, first do the math: The average car loan rate is less than 5 percent and the average credit card rate is around 15 percent.
Foster City, Calif. (PRWEB) February 10, 2014
Credit cards are useful for paying for a lot of things, especially in today’s ever-growing online marketplace. However, a new survey for CardRatings.com by Op4G finds that Americans aren’t just paying the bills or going out to dinner with their plastic, but making large, and sometimes crazy purchases.
The survey – which asked 2,004 American adults the craziest thing they’ve ever purchased with a credit card – found that 57 percent of respondents have made a purchase that in retrospect seems a little crazy. Among the top responses were adult entertainment, cars, college tuition and even weddings.
Putting more items on a credit card can help with a financial burden temporarily, but the interest can quickly add up, as the average consumer pays 12.89 percent on their credit card balance. With the Federal Reserve reporting rising credit card balances over the last three years – which now total nearly $857 billion – Americans are paying close to $110 billion in interest alone just to get out of that debt.
“If a consumer pays off her credit card balance in full each month and has a great rewards program on the card, paying a college tuition bill can earn thousands of points,” said Ellen Cannon, editorial director of CardRatings.com.
The top “crazy” credit card purchases:
- Adult entertainment – 6.7 percent
- Scalped event tickets – 6 percent
- Car – 5 percent
- College Tuition – 4.7 percent
- Tattoos – 3.3 percent
- Wedding – 2.6 percent
- Bail – 2 percent
- Funeral – 2 percent
Adult entertainment credit card purchases were even higher among men, who used their card four times as often as women. In addition, many of the “crazy” purchases are somewhat avoidable with loan programs in place that have interest rates that are fractions of what a credit card would charge.
“If you’re tempted to use a credit card for a big-ticket item like a car, first do the math: The average car loan rate is less than 5 percent and the average credit card rate is around 15 percent. If you can’t pay that credit card balance immediately, you shouldn’t even think about using plastic,” said Cannon.
One respondent even shared that he had purchased marijuana with his credit card, an unconventional purchase, but one that is sure to become more commonplace as states like Colorado and Washington have legalized the drug.
To read the full results of the survey, click here: http://www.cardratings.com/you-bought-what-8-crazy-credit-card-purchases.html
Using a credit card for something that you may look back on and regret is not always avoidable, so to minimize the financial burden, look at some of these low-interest cards, or find a card with great rewards, to help offset the larger charges.
About CardRatings.com
CardRatings.com is the leading comprehensive free source for comparing credit card offers. The site has been educating consumers, publishing news and providing expert advice on credit cards and debt since 1998. CardRatings.com offers consumer reviews of credit cards and issues an annual ranking of top-rated cards in a variety of categories to help consumers find the credit cards best suited to their needs, get the best credit card rates available and effectively lower their debt. The site and its editors are regularly referenced by trusted media outlets such as Time.com, Consumer Reports, Forbes and SmartMoney and by noted financial experts such as Jean Chatzky, Sandra Block and Liz Weston. CardRatings.com is owned and operated by QuinStreet, Inc. (NASDAQ: QNST), one of the largest Internet marketing and media companies in the world. QuinStreet is committed to providing consumers and businesses with the information they need to research, find and select the products, services and brands that best meet their needs. The company is a leader in ethical marketing practices. For more information, please visit QuinStreet.com.
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