We’re used to thinking of credit card use as something available to us on every single occasion. But a few recent stories are reminders that we either can’t or shouldn’t use our credit cards for absolutely everything. Here are four examples.

1. Credit card use when you want to be naughty

You might think that credit card companies would be shy about pointing their collective finger when it comes to morality. But no. Last week, SmartMoney, a Wall Street Journal website, revealed that at least one card issuer won’t authorize transactions for medical marijuana, even when supplied by licensed outlets in states where its sale is legal.

Some credit card companies also refuse payments for online pornography, and many won’t let you buy casino chips with their plastic. Some consumer advocates believe that these restrictions are impossible to justify, but one lawyer told SmartMoney that he sympathizes with card issuers’ policies, at least as far as medical marijuana is concerned. He says they could be vulnerable under federal law if they were to abet users in their purchases of drugs.

2. When you’re financing your start-up enterprise

Of course, there are some outstanding success stories about entrepreneurs who financed their start-up companies using their credit cards. And, according to a recent item on NBC Chicago, many financial advisers say that it’s fine for credit card debt to have a role in funding small businesses.

However, there are two caveats to bear in mind:

1. Your business credit card is likely to be tied to your personal credit report, so spend on it with as much caution as you do your own cards.
2. If your business plan is as sound as you think it is, how come you can’t find investors or banks to cover that card debt? Business credit card rates may on average be lower than personal credit card rates, but you may be able to access cheaper borrowing.

3. When you already have too much credit card debt

It’s Catch-22. When you have unmanageable credit card debt, you usually are in trouble, and may need to borrow more. What you actually need is to make a plan to get out of trouble, and that often starts by strictly controlling your credit card use. Help is at hand, and every card statement includes a help line number where you can get advice. But few call. Last month, Gail Cunningham, a spokesperson for the National Foundation for Credit Counseling, complained:

The low response rate is confusing, particularly during this current economic environment where millions of consumers have serious financial concerns. Consumers are doing themselves a disservice by not taking advantage of this resource, as reviewing their situation with a trained and certified credit counselor could provide solutions they’ve not considered.

4. When you want a peaceful taxi ride

In some cities, taxi drivers may give you a very hard time if you try to use a credit card to pay your fare–in spite of the fact that their cabs may be festooned with American Express, Discover, MasterCard and Visa stickers. Yesterday’s The Bay Citizen suggests that San Francisco may be the latest such city.

Apparently, cab companies have imposed a 5-percent fee on card transactions, and drivers are understandably resentful over having their incomes “taxed” in this way. The Bay Citizen website has a scary video of the sort of conversation you may expect if you try to flash your plastic in a San Francisco taxi.

Credit card use is good

Don’t forget, credit cards are more secure than cash, and generally provide better legal protections than debit cards or prepaid cards. So get yours out whenever you can. Just don’t try to use your maxed-out business card to take a taxi to your medical marijuana outlet in San Francisco. It could be a frustrating trip.

Published 06/03/11