5 Credit Card Errors To Avoid
Below is an article contributed by a guest from CompareHero.my, which allows you to compare credit cards, broadband plan, and others at a competitive price from Malaysia.
“Nobody wants to be tied down indefinitely to interest rates that increase every month. When not managed correctly, credit card usage can lead to really high charges that can deplete your income and savings. Not having proper control over your credit card can also lead to a decrease in your credit score, and will result in reduced chances of increasing your credit limit as well as lessening the possibility to be approved for bigger loans in the future. To avoid the burdens of credit card misuse and to live a more relaxed life that is free from money troubles let me give you a break down on the top 5 credit card errors you should avoid.
1. Not paying attention to the fine print
- Before you apply for a credit card, make sure that you have read the terms and conditions and that you have understood what each condition means. Don’t sign anything without fully understanding each condition included in the fine print as this could lead to problems later on. When you don’t understand a certain clause or condition, don’t hesitate to contact the bank officer and inquire to clarify what the condition means. When you don’t pay close attention, you could end up applying for a credit card with spending requirements you can’t really afford. You can also end up paying high interest rates that can cause you to have little money left to spend every month.
2. Skipping a payment
- Make it a habit to pay your credit card balance bills every month. Although it is tempting to skip payments when we have become too busy with work and other more important events, deadline dates could slip up quickly, and before we know it, we could have a huge bill from incurring late payment charges and underpayments. Take time out of your busy schedule to pay on time to lessen worries and frown lines caused by rising interest fees.
3. Exceeding your credit limit
- It’s easy to max one’s limit with a credit card because all you need to do is swipe, and an item gets paid. Not being careful about recording transactions can lead to interest rates and fees, however. That’s why extra caution should be practiced in the use of credit cards. Try not to get too close to your limit, to avoid chances of going over your credit card limit and hence keeping within the safe lines of zero interest and evasion of additional charges you should not really be paying.
4. Spending to get rewards
- If your sole reason for getting a credit card is only to get the reward points and other promotional items, then you should rethink your spending. Remember to only buy things that you really intend buy, even without the rewards included. You should also keep in mind that spending just to get reward points can only result in incurring numerous interest rates that cancels out your reward points… you wouldn’t want that, would you? Right! So save a little more, forget the rewards, and spend only when you absolutely have to.
5. Not taking time to check your billing statements
- When you get billing statements every month, it could get easy to take them for granted and ignore them all together. Don’t. Check your billing statements faithfully month after month. How else will you know when someone committed fraudulent transactions using your account? The billing statement is also where your bank will include announcements such as higher interest rates or new terms and conditions you might want to note as reference for future decisions and transactions. Handling your personal finances is never easy. That is why you should take your credit card ownership seriously and exert efforts to really meet payment deadlines and to control your spending habits to secure yourself financial stability that you might thank yourself for in the future.”
Hope you learn something new today! Stay cautious of improper use of credit cards!
Pok
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