Having credit cards can be very convenient. You get to experience no cash transactions, amazing promos, and exciting rewards every time you make a purchase with your card. However, mismanaging it can lead to financial problems that will haunt you for a long time. The secret of staying free from debt is the responsible use of credit. Whether you already have a credit card in your name or are planning to apply for one, here are some not so secret tips you should always remember so you do not fall into debt.
Pay Your Full Balance Every Month
Being a responsible credit card owner means you should pay all your balances accumulated every month so you will not be charged with interests and other fees. Only paying the monthly minimum due is almost similar to building your debts. Interest is applied and added to your balance, forcing you to pay more than you used.
Choose Your Due Date
You can always change the due date of your payments with just one call to your credit lender. This tip is effective because modifying your payment date on or before your payday is a guarantee that you will have enough money in your account to make your payment on time. Additionally, you can have your payment date similar to the payment dates of your other monthly bills, so you do not forget when they are due.
Register For Reminders
We are all guilty of getting too busy conquering life’s challenges and forgetting to pay our bills on their due date. A simple reminder that it is time to pay off bills is important so we never miss those due dates again. Register for email and mobile alerts and have your bill sent to your inbox.
Having your reminders sent via email and mobile will also provide you an extra coat of protection. By providing your information to the credit card company, they can send you other notifications and communications about your account. It is always good to receive a monthly update on your credit score, or a warning that your information may have appeared on the dark web.
Stick To Your Budget
It can be really easy to overspend when you have a credit card in your wallet. Especially if you are not monitoring your expenses and won’t stick to a budget you can afford. If you still do not practice it, try to assess your monthly wages and compare it with your expenses. List all the necessary expenses in on a monthly basis and try to set a definitive budget. Every time you swipe your card, ensure that all the things in your cart are within your budget limit. Never develop the habit of spending what you can’t afford.
Never Use Your Full Credit Limit
It can be enticing to use the maximum limit of a credit card but the general rule is to not spend over 29% of the provided credit limit every month, even when you are paying your balances in full. If you are likely to overspend, use your card for recurring monthly dues only such as cell phone bills and internet streaming services.
Know Your Benefits
We all love benefits and advantages. So, it is obvious that we should know what the advantages a credit card has to offer to us are. Several cards provide mileage points for buying airplane tickets or rewards each time you use your card when shopping. Others offer cash back on select purchases. Other credit card companies provide payment plans at 0% interests.
Use Balance Transfers
If you have accumulated a lot of credit card debt, balance transfers can be the next best step for you. This is a method where you transfer your debts from your existing credit card to a newly opened credit card. Doing this can help you decrease your interest rates while you continue to pay on your remaining debt.