To Use a Credit Card or Not: A Christian Perspective
October 7, 2024
Credit cards have become ubiquitous. For most people, they are a common method of paying for purchases. There are certainly no biblical prohibitions against the use of credit cards. However, let’s examine credit cards more closely through a filter of good stewardship.
The benefits of credit cards
As regular credit card users know, there are many practical benefits. Topping the list are the points that can be used for airline tickets, hotel stays, car rentals, and more. At CCCU, for every dollar in purchases with its CUrewards card, a portion even goes to missions and ministry projects.
Using a credit card is also a very secure way of making purchases. If someone stole your wallet, any cash inside would likely be taken. If a thief used your debit card and made a fraudulent purchase, that money would come out of your checking account. While most debit cards have zero liability policies that should ultimately lead to the money being replaced, as you wait for the resolution of your claim, your account will be missing that money, which may make it hard to pay your bills.
With a credit card, a fraudulent purchase won’t hit your checking account; it’ll hit your credit card statement. You’ll have time to file a dispute before the bill comes due.
One credit card caution and a solution
Studies have shown that people tend to spend more when using a credit card than when using cash. The transaction feels more abstract, making you less hesitant to spend than if you had to pull dollar bills out of your wallet. However, if you follow these four “rules of the road” for the wise use of credit cards, you should be able to use them without overspending.
- Use a credit card only for pre-planned, budgeted items. In an ideal world, you would have a budget that enables you to live within your means. In your plan, portions of your income are allocated to giving, saving, investing, and spending on everything from food to clothing. If you have $50 allocated to clothing each month, you can charge $50 worth of clothing each month.
- Track your use of a credit card as you use it. When you make a purchase with a credit card, you won’t need to actually pay for the purchase until later when you receive your credit card statement. A common way people get in trouble with credit cards is they don’t keep track of their charges. Then, when they receive their statement, it can be surprising how much they owe. It is far better to track your use of a credit card as you make purchases. If you charge $50 worth of clothing, that comes out of this month’s clothing budget. If you use a manual budgeting system, like a paper & pencil system or a spreadsheet program, you’ll have to remember to account for such spending. If you use an online budgeting tool, it will automatically capture your credit card purchases and attribute them to this month’s budget. You’ll just have to make sure those purchases are categorized correctly.
- Pay your balance in full each month. Credit card interest rates often exceed 20 percent, which is why it’s essential to avoid carrying a balance from month to month. If you’re unable to pay your bill in full each month, that may mean you’re not properly tracking the use of your credit card as you make purchases.
- If you can’t follow the first three rules, don’t use credit cards. The apostle Paul pointed out that while all things may be permitted, not all things are constructive or beneficial. Biblically speaking, using a credit card is permitted. Whether it’s constructive or beneficial depends on how you use the card.
Click here to view all credit card options provided by CCCU.
Matt Bell is the author of Trusted: Preparing Your Kids for a Lifetime of God-Honoring Money Management. He speaks at churches and conferences throughout the country and writes the MattAboutMoney blog.
This article should not be considered legal, tax, or financial advice. You may wish to consult a tax or financial advisor about your individual financial situation.
