Credit Cards and Investing
Investors should know that most registered investment firms in Manitoba do not allow customers to use credit cards to purchase investments.
Borrowing to invest is considered highly risky. Making an investment purchase on your credit card or using a credit card for a cash advance is similar to borrowing money but at a very high interest rate.
In cases where criminals offer fake investments to steal your money, what they really want is your credit card so they can make repeat purchases on your card without your authorization. If you are asked for credit card information to make an investment purchase, beware that this is often a warning sign of fraud.
Risks of using a credit card to buy investments:
- You may be defrauded.
- High interest rates and transaction fees may erode returns.
- If you don’t make payments on time, your credit score may be damaged.
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