Home Improvement: Should You Use Your Credit Card? | Credit ...

?Posted on April 3, 2012 by Jennifer in Credit Card Tips

Do you need new appliances because yours are outdated? Do you need to repair a leaky roof and you don?t have the cash on hand? If you?re anything like me, you could come up with dozens of home improvement projects you?d love to tackle. But should you save up for each of them individually, or is it okay to use your credit card to pay for them over time?

The answer to that question depends on your unique situation. But here are some factors to consider when making that decision ? times when it might be a good (or bad) idea to use credit cards for home improvement projects.

When to Avoid Using Your Credit Card for Home Improvement Projects

There?s always one good reason not to use your credit cards. And that?s when you can?t afford to. It?s never a good idea to whip out your card just because you want to do something. For example, being tired of the way your cabinets look isn?t a great reason to go into credit card debt.

If you don?t have a plan to pay off the balance in a reasonable amount of time, you?re probably better off waiting until you can work the project into your budget. And don?t forget to account for the interest charges. Try to avoid using high interest credit cards to finance these large repairs or other projects whenever possible.

When It?s a Good Idea to Use Your Credit Card for Home Improvement

Okay. So you shouldn?t use credit cards to tackle projects on a whim when you can?t afford them. Nothing new there, right? Now let?s look at the other side ? when it can be a good idea to pay for home improvement work with your credit card.

• The repair is necessary and you can?t wait (perhaps the damage will become more costly if you do). For example, if you have a bad leak in your roof and you don?t have the cash to fix it, using your credit card now could save you from more expensive damage down the road.
• You plan to use a rewards card to pay for the project and you can afford to pay off the balance fairly quickly. Home improvement projects can cost quite a bit, meaning you might be able to earn a lot of rewards points. In this case you might even charge the supplies and labor costs and then pay off the balance right away to avoid interest altogether.
• Using your credit card might actually save you money. For example, let?s say you planned to get new hardwood flooring soon anyway. You visit a retailer that?s selling flooring you love at a huge discount (maybe they?re clearing it out for newer options). If you could save 50% or more on the flooring now instead of waiting a few more weeks as planned, using your credit card might make sense. You could pay it off when you originally planned to in a few weeks? time, and the interest you pay could be minimal compared to the money you saved on the supplies.

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Do you use your credit cards to finance home improvement projects? When do you rely on them, and when do you choose not to? Tell us why in the comments below.

Jennifer Mattern is a professional blogger writing for CreditCard.net and other online publications. In addition to working as a freelance writer covering business and finance issues, she is also a Web publisher and e-book author.

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