5 Credit Card Tips You Will Be Glad You Know Now
When we get our first credit card, we feel as if we have hit the jackpot. Whenever we don’t have cash with us, we flash our credit card, and boom, the things we want start appearing out of now. Using it feels so good that we forget about the existence of physical money, and then comes the credit card report.
Now you are in big trouble, as the debt on the credit is as high as Mount Olympus, and we only have ourselves to blame. Most of us have made this hair-raising mistake at some point in our lives, but there is still time to rectify it. With these five credit card tips, you will avoid unwanted debt and maximize your savings:
1. Rewards Points Are Your Worst Enemy
Rewards points may sound like a good deal, but they are nothing more than just borrowed money from a bank. Do you know what happens when you borrow money from the big man? The interest rates on the credit cards increase overtime. However, this doesn’t apply to every credit card, but it’s better that you steer clear from it. Would you rather have rewards points or lower interest rates? You decide!
2. Chop the Credit Card Limit in Half
Most banks have this knack for giving the customer a high credit card limit. Sounds great, right? They really have the best interest (I see what I did there) of their customer in mind…or do they? High credit card limits enable you to make expensive purchases and as long as you pay them what you owe, you will do just fine.
The claws will come out when you won’t be able to make the monthly credit card payments on time, as your interest will increase. The lesson here is to call the bank and tell them to half the credit limit, even if you have to do it with a heavy heart.
3. Be Loyal to One Credit Card
Most people with high credit card debts tend to go from one card to the next to make their payments. For this reason, they get easily enticed with offers of zero interest rates or benefits of a balance transfer. Instead of switching sides, call up your bank, tell them about your intentions, and most likely, they will try to match the offer to keep you on their side.
4. Credit Card Promotions Are Benefits in Disguise
Most banks know what they need to do to attract new customers so they launch promotions such as low or zero interest rates, low rates for balance transfers, and zero annual fee for the first year, amongst others. Don’t play the fool and jump to take advantage of the promotion, smarten up and do your research. Make sure you know exactly what is going to happen after the promotion ends, or you will end up deltoid deep in debt.
5. Debit Cards Are Your Friend
Credit cards have taken center stage to debit cards when it should be the other way around. Debit cards will help you save, as you will have a predetermined limit of how much you can spend. If your spending habits are uncontrollable, debit cards will help keep them in check.
With the help of these credit card tips, you will be on your way to a money-saving lifestyle.
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