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If you are going to make an expensive purchase, it’s important to use the right credit card for you to maximise your rewards and benefits. This guide will take a look at all the benefits of charging your large expense on plastic and help you compare available options that are optimised for such transactions. Below is a list of top cards to consider.
The only major drawback to charging your expenses on plastic is the tendency to lose sight of your purchases and racking up more debt than you’re able to settle. But if you have the capacity to pay for the amount that you spent on your card, then there’s little reason not to do so.
Here are some reasons to pull out your card when making a large purchase:
When looking for the best credit card to charge your major expense on, there are several factors you should consider:
It’s important to carefully consider how and when you’ll be using your credit card for large purchases, as well as how soon you can repay the full amount. If you do decide to go with credit payments, here are some tips to help ensure that it stays affordable and convenient:
Once you’ve maxed out the credit limit of your credit card, you can no longer make any further transactions. However, there are a few options you can consider if your big-ticket item exceeds your existing credit limit:
The Monetary Authority of Singapore (MAS) has implemented its third and final revision for the total unsecured credit limit, decreasing the total borrowing limit to 12 times a borrower’s monthly income.
That means that if your total outstanding balance exceeds 12 times’ your monthly income across all unsecured credit facilities for more than 3 consecutive months, you’ll not be able to apply or access further credit.
This measure is part of MAS’ ongoing efforts to help Singaporeans manage unsecured debt.
Instead of keeping track and accumulating multiple small purchases to a sizable amount, charging a big-ticket purchase can help you reel in these bonuses quickly. You can earn thousands of points and miles, activate an attractive spending bonus, receive a free hotel stay or even earn elite status with a partner loyalty program.
So if you want a credit card that is optimised for big-ticket purchases, then start comparing your options here.
What are the best reward types for charging large expenses?
The right reward type will depend on your personal preference and spend bonuses that the card is offering. Whether it’s cashback, miles or reward points, you should sign up for one that allows you to maximise your earning potential. Many credit cards offer bonus incentives, free hotel stays, or elite status upgrades when you hit pre-defined spending thresholds. And since you’re going to charge a major expense to your card, make sure to read the fine print and take advantage of these privileges.
When shouldn’t I use a credit card for large purchases?
Avoid swiping your credit card on purchases when:
Should I consider a charge card?
It may be outside the scope of this guide, but you may consider using a charge card instead of a credit card for big purchases.
The main advantage of charge cards is that they come with no pre-set spending limits. Instead, your transactions are approved based on your spending patterns and payment history. However, charge cards have no interest fees and do not allow you to carry an outstanding balance like credit cards, so you’ll need to pay off your balance in full each month.
As charge cards are designed for high-income individuals, you’d need to have an annual income of at least S$200,000 p.a to apply.
Is it worth charging my big-ticket purchase to plastic even if I can’t afford to pay in full by the next statement?
Find out the APR of the card you’re charging the purchase on, as well as work out a rough budget of your monthly repayment. By understanding how long you’d take to pay off the transactions and how much the interest will cost you, you may do a side-by-side comparison with the potential rewards it brings and finds out which option brings you the most value.Back to top
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