It’s repetitive as it’s necessary because you should never get tired of hearing it: your credit card can be your friend (or foe), and it all depends on the way you use it. Nowadays, it’s so easy to get hooked into promos and offers because of the way they are advertised—as if you need them, when at times, you really don’t. However, it’s also true that a credit card can come in handy when you’re in an emergency, or if you simply want to build a great credit history.
Seven Bits of Knowledge in Handling Credit Cards
1. Stay away from high credit limit offers. Don’t let sign-up bonuses fool you—especially if it’s your first time. A high credit limit might give you the false sense of security that you’ve got all the money to spend which will eventually lead you to the dangerous slope of debt. To avoid this, get a credit card with a credit limit that is below your monthly salary.
2. Avoid maxing out your credit limit. Unless used for emergencies, your credit limit should never reach its peak. This is especially dangerous for cardholders who have high credit limits. Remember: your credit is the debt you actively take responsibility when you use it, and take note that repayment comes with interest. Overspending is NOT an option.
3. What do you say to a cash advance? Not today! Cash advances have an interest that is on top of paying your Annual Percentage Rate or APR. For example, you might already be paying an APR of 13%. If you add the maximum average interest rate of 7%, that’s you paying a total of 20%! That’s why you should use your cash advance only when absolutely necessary because your credit card is NOT your ATM.
4. Let your credit card celebrate a birthday before closing them. Actually, avoid closing credit card accounts abruptly. As much as it pains you to think you’ve got lingering accounts that threaten you with impulsive purchases and debt, the best you can do is to pay off what you owe to those accounts, and leave the cards at home. Eliminating the accounts (and eventually opening new accounts just because you realized you need a credit card in your life) is not going to help your credit score. That’s why I advise you to keep your credit cards at least one year (or more).
5. Pay your purchases in full within the next three months. Or less. Your goal is not to pay the minimum per month—this will only prolong the payment process. Doing so will also give you the right mindset that you are only supposed to buy things that you can actually afford—not things you have to slave for just to pay off. Also, prolonging the payment process increases the interest you have to pay. It also helps to pay your bill before your grace period to avoid late fees and such. So as much as possible, pay off your debt as soon as possible!
6. Use your monthly bills to track your spending habits. Being self-aware is always a step in the right direction. Review all your expenses to check which items or services you spend on the most. This will give you an idea as to whether you should limit your spending, or to evaluate as to whether you are using the right card for the right expenses. For instance, there are credit cards that offer benefits when you shop in certain stores or enables to get you miles when you travel. If you already have a credit card, you might as well make the most of the experience!
7. Letting go… the right way. If you’ve cleaned your debt with one credit card account and you’re absolutely ready to put it to rest—or if you’re simply trying to avoid using it all together without using the account, don’t forget to dispose of your credit card properly. Don’t just throw the plastic card into the trash bin. For your safety, make sure to cut the card into pieces and throw the pieces away in different locations.
Are you ready to take on your own credit card?
Who says owning a credit card is immediately synonymous to being in debt? With a budget, a plan, and a responsible and cautious mindset—it’s more than possible to use your credit card for the greater good! For as long as you don’t get behind on your payments, spending beyond your means, and using your credit card for your everyday expenses—you’ll no doubt find yourself walking on the right path. Wise credit card usage is more than possible for anyone!
What if it’s too late?
It’s never too late, and that’s a fact! In Financial Rescue LLC, we believe that there’s a will, there’s a way out of debt. Don’t have second thoughts (or feel shy) and explore your options in clearing your name of debt because it’s possible! Take the necessary steps to change your lifestyle and treat your credit card with utmost care (great power comes with great responsibility), and enroll yourself in our sought-after debt settlement programs. Partner with us and you will reap the benefits of settling your debt with a much lower amount!
If you’re ready to experience the ultimate debt relief program, call 1-877-97-DEBTS now!