Do’s And Don’ts To Manage Your Credit Cards
Credit card is basically one of the most commonly used financial tool in the world, because almost everyone has at least one or two. Credit card can actually be people’s best friends, and at the same time, their worst enemy. To a child, it is like a magic card, because that is all you need in order for you to buy whatever your heart desires. If you don’t know how to use the right way, it can be pretty dangerous since it is like borrowing money to pay for your shoppings spree, without exactly having enough to pay for it. So here are a couple of do’s and don’ts when it comes to using your favorite financial tool.
PAY FOR IT ON TIME
Credit card is technically debt, so it is ideal to actually pay for it on time, all the time. This is to keep you on track of your credit card payments, and if you think that paying for the minimum amount required is a good a idea, well think again, because interest and penalty charges will eventually pile up, and the penalty charges may actually cost more than the actual principle. Keep in mind that when you pay for it after the cutoff time, it will be considered late and your creditor will then charge a late fee, that is why on your next billing statement, will have an additional fee into it for the missed or late payments.
Your credit card score may actually drop, which will definitely affect your ability to get a new credit card in the future if you’re planning for it, because then the payment history is 35 percent of the credit score, and you, paying usually late will affect it badly.
OWN ONE OR TWO
There are actually no worries if you want to own as many credit cards as you want, as long as you pay for all of them on time. However, if you know that you won’t be able to handle it, then it is best to stick to one or two only, it is good enough to have a nice credit score. With only one or two credit cards, you will be able to control yourself and discipline yourself more since you will be cautious of the limits of the credit cards, if you have a lot, there are chances that you might not be able to keep track on your purchases.
KEEP A RECORD OF PURCHASES
By keeping track of the purchases with the use of your credit card, you will be able to monitor your charges as well as your limitations. It would also help you to remember these things so that you wouldn’t be surprised when the bill comes in case you forget that you actually purchased a specific item. It will also allow you to set aside some money to pay for your credit card bill and it will keep you from spending money on unnecessary stuff.
DON’T LEND IT TO SOMEONE ELSE
One of the worst things to do on your credit card is to let anyone borrow it. It actually doesn’t matter if it is your child, your parents, your spouse. Unless of course, you’re a millionaire who doesn’t really mind other people having a shopping spree with your credit card.
NO CASH ADVANCES
Cash advances is a big NO when it comes to credit cards. This is because cash advance would, unfortunately, lead to higher interest rate, not just on your advance account, but also on your transaction fees.
Also, it doesn’t have a grace period, and that would mean, that from the moment you have gotten your cash advance, the interest would then begin.
LIVE WITHIN YOUR MEANS
Last, but probably the most important thing to remember when it comes to credit cards, is that you must live within your means. If you know that it will be difficult for you to pay for a certain item, that you don’t really need, then what’s the point of getting it in the first place? It is like fooling yourself, because overspending is never a good thing, and you know it. Credit cards are just a tool for you to use so that you could buy something that you could pay for later on.
More in Debt
5 Successful Kardashian Businesses We Can Learn From
The Kardashians are followed by almost everyone nowadays. This has given them the opportunity to take advantage of such fame and...October 23, 2017
Most Expensive Auctioned Items Of All Time
If you think auctions have been around for hundreds of years, well, think again, because it has actually been around for...October 23, 2017
Hollywood Rich Kids: Stars Who Were Born Wealthy
When people think of celebrities, they would immediately get the idea of being rich and famous. Probably because celebrities do get...October 23, 2017
Perfect Ways To Help Your Chosen Charity
When it comes to helping the ones who are in need, people seem to be united as one, and it is...October 23, 2017
How To Live Within Your Means
When people say that it is ideal to live within their means, they are indeed correct, however, a lot of people...October 23, 2017
Recycling Tips For Saving Money
Recycling not just help to reduce waste and avoids creating pollution but it is also good for the environment. Many people...October 23, 2017
5 Highest Paid TV Stars In 2017
We have entered the golden age of TV. Gone are the days where aspiring actors would try out for TV roles...October 23, 2017
Important Things To Ask Your Financial Planner Before Signing A Contract
When you seek the services of a financial advisor, you are looking at someone who will manage your most valuable properties....October 23, 2017
Legitimate Ways To Earn Money For Young Adults
School is out and summer is definitely here, there endless of things to do, especially if you’re young. As a parent...October 23, 2017