Here’s Why It Pays Off To Put Small Purchases on a Credit Card

Most products on this page are from partners who may compensate us. This may influence which products we write about and where and how they appear on the page. However, opinions expressed here are the author's alone, not those of any bank, credit card issuer, airline or hotel chain.

When you get your morning latte and bagel, how do you pay for it—cash or credit? Historically, most people in the U.S. have used cash for small purchases, but the number of folks opting to swipe a credit card is increasing. And from helping you earn rewards to bolstering your financial protections, sticking those small purchases on your favorite credit card can be a savvy move—here’s how.

Four reasons to pay for small purchases with a credit card:

1. You can earn rewards
2. You can improve your credit
3. Credit cards have more consumer protections
4. It can help you track expenses

Recommended Credit Cards

Credit Card	Rewards Rate	Annual Fee	Bonus Offer	Learn More
Chase Sapphire Preferred® Apply Now	1x- 5xPoints More Info Enjoy benefits such as 5x on travel purchased through Chase Travel℠, 3x on dining, select streaming services and online groceries, 2x on all other travel purchases, 1x on all other purchases, $50 Annual Chase Travel Hotel Credit, plus more.	$95	60,000Chase Ultimate Rewards Points More Info Earn 60,000 bonus points after you spend $4,000 on purchases in the first 3 months from account opening. Dollar Equivalent: $1,380 (60,000 Chase Ultimate Rewards Points * 0.023 base)	Apply Now
Southwest Rapid Rewards® Plus Credit Card Apply Now	1x - 2xPoints More Info Earn 2X points on Southwest® purchases. Earn 2X points on Rapid Rewards® hotel and car rental partners. Earn 2X points on local transit and commuting, including rideshare. Earn 2X points on internet, cable, and phone services; select streaming. Earn 1X points on all other purchases.	$69	$400 statement credit + 40,000 pts.Southwest Rapid Rewards Points More Info Earn a $400 statement credit and 40,000 bonus points after spending $3,000 on purchases in the first 4 months from account opening. Dollar Equivalent:	Apply Now
Wells Fargo Active Cash® Card Apply Now Rates & Fees	2%Cashback More Info Earn unlimited 2% cash rewards on purchases.	$0	$200Cash Bonus More Info Earn a $200 cash rewards bonus after spending $500 in purchases in the first 3 months.	Apply Now Rates & Fees
Citi Custom Cash® Card Apply Now Rates & Fees	1% - 5%Cashback More Info Earn 5% cash back on purchases in your top eligible spend category each billing cycle, up to the first $500 spent, 1% cash back thereafter. Also, earn unlimited 1% cash back on all other purchases. Special Travel Offer: Earn an additional 4% cash back on hotels, car rentals, and attractions booked on Citi Travel℠ portal through 6/30/2026.	$0	$200Cash Bonus More Info Earn $200 in cash back after you spend $1500 on purchases in the first 6 months of account opening. This bonus offer will be fulfilled as 20,000 ThankYou® Points, which can be redeemed for $200 cash back.	Apply Now Rates & Fees

1. Credit Cards Help You Earn Rewards

The best cash-back credit cards might let you earn 3% or more cash back on purchases in some categories. Now, if you spend $10 on a bagel and coffee, that might not add up to much alone, but if you use your credit card for all your small expenses, the rewards could really add up by the end of the month or year.

2. Using Credit Cards Can Help Improve Your Credit

The big trick here is to make sure you can pay your credit card bill on time and in full each month if you want to improve your credit score. On the other hand, if charging lots of small expenses makes it harder for you to keep track of your budget, this might not be the move for you. But if you know how much you’re buying and aren’t tempted to overspend, putting those little transactions on your credit card and then paying the bill in full can help your credit score increase.

3. Credit Cards Come With Strong Protections

Credit cards come with an added layer of protection that debit cards usually don’t have. When your credit card is compromised, you can report fraudulent spending immediately, and you will not be responsible for the charges. Your bank account remains untouched.

On the other hand, if your debit card falls into the wrong hands and someone racks up unapproved charges, those purchases could end up costing you hundreds or even thousands of dollars. Banks will typically work with you to reverse fraudulent charges, but this can sometimes take days or weeks. And in the meantime, your main source of money is tied up.

Related Article

How to Dispute a Charge on a Debit Card

Read More

4. Credit Cards Can Help Track Expenses

Another benefit of using a credit card for smaller purchases is that your statement can help you keep track of them all. This can be handy for anyone watching their budget or sharing a card with an authorized user or spouse, for example.

But it can be even more useful if you’re spending small amounts as a business owner and want a simple way to track your professional expenses and keep them separate from your personal ones.

Should You Put Small Purchases on a Credit Card?

Whether you should put your small expenses on a credit card depends on your spending habits. If you know you’ll be able to pay your full bill each month, using your card for small transactions can help you build credit, manage your expenses and earn lucrative rewards.

On the other hand, if having that credit card handy for every transaction is a little too convenient and you’re worried about overspending, you might want to stick to your debit card or cash for some purchases.

Best Credit Cards for Small Purchases

If you are going to use a credit card for small purchases, choose one that rewards your spending. For example, if you spend more money on food than anything else, look for a card that gives the most cash back for grocery stores and dining expenses like takeout and delivery. For many shoppers, the following cards offer the most rewards for all types of spending.

Citi Rewards+® Card

This product is currently not available via Slickdeals. All information about this product was collected by Slickdeals and has not been reviewed by the issuer.

• Our Rating 4.0/5 How our ratings work
• APR17.99% - 27.99% (Variable)
• Annual Fee$0
• Sign Up Bonus 20,000Citi ThankYou® Points More Info

  Earn 20,000 bonus points after you spend $1,500 in purchases with your card within 3 months of account opening; redeemable for $200 in gift cards at thankyou.com Dollar Equivalent: $360 (20,000 Citi ThankYou® Points * 0.018 base)

The Citi Rewards+ Card, from our partner Citi, rounds up all purchases to the nearest 10 ThankYou Points. For example, if you bought a cup of coffee for $2, you’d earn 10 ThankYou Points. Similarly, if a burger and fries cost $15, you’d earn 20 ThankYou Points. So if you make a lot of small purchases, like a morning cup of coffee, this could be the card for you.

• Overview
• Pros & Cons

Overview

The Citi Rewards+^® Card,  from our partner Citi, may be ideal for people who want to earn cash-back rewards for everyday spending, but do not want to pay an annual fee. It’s also a strong option for people who make frequent small purchases, since this credit card rounds each purchase to the nearest 10 points — even buying a $0.75 candy bar will earn you 10 points.

Pros

• Great for small purchases: All transactions round up to the nearest 10 points
• Get 10% of your redeemed points back each year (for the first 100,000 points redeemed annually)
• No annual fee

Cons

• 3% foreign transaction fee, don't use this card abroad if you don't have to

Citi Double Cash® Card

Apply Now

Secure application on issuer’s website

Rates & Fees

• Our Rating 4.5/5 How our ratings work
• APR18.49% - 28.49% (Variable)
• Annual Fee$0
• Sign-Up Bonus $200Cash Bonus More Info

  Earn $200 cash back after you spend $1,500 on purchases in the first 6 months of account opening. This bonus offer will be fulfilled as 20,000 ThankYou® Points, which can be redeemed for $200 cash back.

The Citi Double Cash® Card, from our partner Citi, is among the top cards on the market for general spending. Forget the cards that offer 1% and 1.5% cash back. The Citi Double Cash Card offers you a whopping 2% cash back for all spending. Earn 1% back when you make a purchase and 1% back when you pay your account balance.

• Overview
• Pros & Cons

Overview

The Citi Double Cash^® Card, from our partner Citi, offers attractive and uncomplicated cash back for people who value a flexible credit card reward program. The Citi Double Cash Card gives you the chance to earn 2% cash back on your purchases. You can receive 1% cash back when you make a purchase and an additional 1% cash back once you pay your bill.

Pros

• No category bonuses to remember, unlimited 2% cash back on everything
• Earns ThankYou Points, which gives the potential to unlock valuable travel rewards

Cons

• Foreign transaction fees are applied
• Limited perks

Chase Freedom Unlimited®

Apply Now

Secure application on issuer’s website

• Our Rating 4.5/5 How our ratings work
• APR19.74% - 28.49% (Variable)
• Annual Fee$0
• Sign Up Bonus 1.5%Extra Cash Back More Info

  Earn an extra 1.5% on everything you buy (on up to $20,000 spent in the first year) — worth up to $300 cash back. That’s 6.5% on travel purchased through Chase Travel^SM, 4.5% on dining and drugstores, and 3% on all other purchases.

We like that the card offers a high flat rewards rate but also provides accelerated rewards on some common everyday spending categories. You’ll also get access to the Chase Travel^SM portal, which allows you to use your cash-back earnings for travel rewards, gift cards and more. If you make this your primary card for most purchases you can quickly rack up a lot of rewards.

• Overview
• Pros & Cons

Overview

The Chase Freedom Unlimited card is unique for a couple of reasons. First, it comes with purchase protection and extended warranty protection you don’t see with some other cash-back cards. Second, you earn cash back in the form of points and when paired with another annual-fee earning Chase product, you can get even more value if you love to travel by transferring to partners.

That’s because while the Freedom cards are marketed as cash-back credit cards, they actually offer points. You can use those points to book travel through Chase at a rate of 1 cent per point. But if you have the Chase Sapphire Preferred® or Chase Sapphire Reserve®, you’ll get 25% and 50% more value on those travel redemptions, respectively. (Plus, the ability to transfer your points, too.)

Read More

Pros

• No category bonuses to remember; earn at least 1.5% back on everything
• No annual fee
• Generous travel and purchase protection benefits

Cons

• Can't transfer Chase points unless paired with another annual-fee Chase product

Credit cards have a reputation for causing people to go into debt. Yet the idea that opening credit cards is a bad financial choice isn't fair or accurate. You get to decide how you will use your credit cards, just as you get to decide how you'll use the money in your bank account.

Our card roundups help people maximize their credit card rewards earnings for planned, everyday spending. Here are a few to get you started:

• Biggest Credit Card Bonuses
• Best Cash-Back Credit Card Bonuses
• Biggest Business Credit Card Bonuses
• Best "No Annual Fee" Credit Card Bonuses
• Biggest Travel Credit Card Bonuses
• Best Credit Card Deals and Promotions

If you feel confident that you can manage your credit cards responsibly (paying on time and in full every month), your accounts can be an asset instead of a burden. A well-managed credit card may help you to establish better credit scores over time and can help you take advantage of some amazing rewards.