Your credit card can be a wonderful enabler or a weapon of financial destruction.

I’m Adam Levin and this is the Wall Street Journal Credit Minute.

Of all the things you can charge with a credit card, here are three really bad ideas:

  1. Taxes. Many people find credit cards a tempting way to pay taxes if they discover they’re faced with a larger bill than expected. But beware: processors collect an average fee of 2% on top of the interest charged by the card, while the IRS underpayment interest rate is running at about 3 percent. You can also have your withholding adjusted to prevent against nasty surprises.
  2. A Big Wedding. Everyone wants their wedding to be the memory of a lifetime, but no one wants to spend the early years of their marriage digging out of debt. Better to live within your means and use the money you would have paid in interest to build a nest egg.
  3.  Vacations. Isn’t stress reduction why you take a vacation? Financing a trip on credit cards can turn your adventure of a lifetime into a real world nightmare. Your getaway should fit your means. If you want your vacation to be the stuff of legend, create a vacation fund.

If you intend to pay it off immediately, by all means use your card as a convenience and vehicle for generating rewards. Just never use it to finance that which you can’t afford.

Charge wisely my friends!

I’m Adam Levin. Come to and take control of your credit.