How to Use a Credit Card During an Emergency

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There’s a certain set of rules that responsible credit card users follow. These include habits like paying off your amount due (or better yet, total balance) each month and staying under 30% utilization. Of course, everything changes during an emergency situation. 

In this article, we’re going to look at six tips for using your credit card during an emergency.

6 Tips for Using Your Credit Card During an Emergency

Whether it’s an unexpected layoff or a steep medical bill, there are some circumstances we simply can’t plan for. When those situations arise, it’s best to rely on your savings as opposed to your credit cards. Still, if used wisely, your credit cards can help keep you afloat until circumstances improve. 

Follow these tips for maintaining financial stability during an emergency without falling victim to long-term debt or a damaged credit score:

Table of Contents:

  1. Maintain Your Priorities
  2. Pay Minimums on Time
  3. Contact Your Lenders Early
  4. Don’t Worry About Utilization Percentage
  5. It’s Okay to Carry a Balance
  6. Consider a Balance Transfer

1. Maintain Your Priorities

In any emergency situation, the most important thing to do is maintain your priorities. No matter what the circumstances are, take the time to revisit your budget and adjust it accordingly. You’ll need to decide which bills to pay first and which expenses are most important. In these cases, unsecured debt is the lowest priority. 

Of course, your key concerns are maintaining enough food, water and essentials to sustain your household throughout the crisis. 

If you don’t have any other options, you can charge these essential purchases to your credit card. You should never prioritize your credit card balance or additional payments over food and necessities at home. Your credit score can be salvaged over time, which means that paying off your credit card doesn’t have to be a goal of yours during an emergency situation.

2. Pay Minimums on Time

The two biggest factors affecting your credit score are the amount owed and on-time payments. While you may not be able to reduce the amount that you owe during a crisis, you can still keep a healthy credit score by making payments on time. 

“Late pays stay with you for years,” money expert Clark Howard cautions. “But using too much available credit heals very quickly as your financial situation improves and you can pay down balances.” 


While paying off your credit card in full isn’t the biggest priority in the face of an emergency, making your minimum payments should be. Continuing to make on-time payments will have a lasting impact on your credit score, and it will put you in a great place to begin raising it again after the crisis.

3. Contact your Lenders Early

If you find that you aren’t going to be able to pay the minimum amount due on time, it’s important that you contact your lenders as soon as possible. 

“As someone fights against more bills than available money, the first priority is to continue to be listed as current with your creditors,” says Clark. “You either need to be able to pay at least minimums on time or negotiate a new payment plan with a creditor.”

Take the time and make that phone call so that your lenders are aware of the situation you’re facing and understand that you’re making an effort to stay current. You may be able to agree on a new due date, minimum amount or another arrangement to ensure you don’t fall behind in the eyes of the credit bureaus. 

If you’re able to come to an agreement with your lenders, be sure to verify that it includes being reported as on-time to the credit bureaus. Clark recommends that you get a copy of this negotiation in writing (whether it’s an email or chat record) just in case you’re still reported as delinquent by the creditors.

4. Don’t Worry About Utilization Percentage

As we’ve said, it’s very important that you’re reported as current with lenders. When it comes to the amount you actually owe, your credit score can more easily recover from a temporary hit. That means that your credit card utilization percentage isn’t quite as important as it is to make minimum payments on time during an emergency. 

Take a moment to look over this breakdown of how your FICO score is determined

Credit score factors chart

As you can see, payment history and amounts owed are the two factors that make up the majority of your credit score. 

If you miss a payment, it will take years for it to fall completely out of your on-time payment average. On the other hand, you can decrease your amount owed as quickly as possible once your financial situation improves.

Ultimately, if you aren’t able to pay your credit card off in full or need to charge food and other necessities during an emergency, that’s okay! As long as you can make your minimum payments on time, it’s less important to worry about your card’s utilization percentage at this time.


5. It’s Okay to Carry a Balance

Because you can easily reduce your utilization percentage once the emergency situation is resolved, it’s okay to carry a balance on your credit card during an emergency.

Instead of trying to decrease your debt during a financial crisis, focus on covering your household’s necessities, building your emergency fund and maintaining your own health. 

Commit to making a plan to pay off your credit cards once your financial situation improves. When you’re ready, you can check out our guide on how to get out of debt in seven easy steps.

The point is that you can always decrease debt that accumulates, but in the time of an unexpected emergency, having a line of credit may be a lifesaver. In that case, it’s certainly okay to carry a balance.

6. Consider a Balance Transfer

Lastly, if you already have good credit and are working on paying off debt, you may want to consider a balance transfer to consolidate debts and get a lower interest rate. During a crisis, you might also end up charging more to credit cards than usual. A welcome bonus, lower interest rate or additional rewards could be helpful in the long run. 

To get started, you’ll need to know your current balances and interest rates. From there, you’ll need to look for cards that offer favorable terms for a balance transfer. Once you’ve read the details, applied for the card and transferred your balance, just be sure to pay off the debt as soon as possible

For more details on each of these steps, check out our guide on how to pay off debt with a credit card balance transfer.

Final Thoughts

Overall, your credit card can be a valuable tool in the face of an emergency. Never hesitate to use it for food and other essentials that you and your family may need. 

Again, the most important thing is to maintain your priorities. You can begin looking at your credit card payments once your basic needs are met. Work out how to consistently make your minimum payment on time during the emergency. If you’re going to be late or miss a payment, be sure to contact your lenders and let them know early. 

Don’t stress as much about your utilization percentage and know that it’s okay to carry a balance while you’re trying to get back on your feet. Consider a balance transfer if you need assistance, just be sure to make a plan to pay off your debt as soon as your situation improves.

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