7 Practical Steps For Managing Your Credit Card Responsibly

While it’s true that credit cards can come in handy when you get caught cashless on certain instances; but then it’s also wise to take note of the fact that excessive use of credit cards can only lead you into the path of going straight down the drain of having a bad credit history.

Therefore, it’s important to be smart when it comes to using credit cards and managing your debts associated with it so you don’t find yourself in much deeper trouble in the long run. It’s obviously very easy for anyone to acquire large debts through credit cards; but, it’s extremely hard to get out of a credit card black hole once you’ve been eaten by it alive. That said, here are some tips to consider when it comes to managing your credit cards wisely.

Only use one card

You don’t really need a lot of credit cards because it will only result in a lot more repayments to various banks and credit card companies. Typically, most people would use cash advances from one card to pay the debt in another. The thing is, this system will only make your financial condition much worse because managing multiple debts can be time-consuming and even confusing; not to mention there’s the hassle of managing multiple credit cards.

Always pay the monthly balance of your credit card in full

It’s always good practice to pay the monthly balance of your credit card in full so that you don’t end up paying unnecessary interest. However, just in case unforeseen circumstances occur that you have no control of; then, at least have your debt paid within a maximum of two months – no more, no less.

Opt for another alternative

If you find yourself always maxing out your credit limit each month then a much wiser alternative would be to apply for a personal loan which charges lower interest rates compared to credit cards.

Have a card calculator handy

It’s always a good idea to have a card calculator handy if you deem that you can only pay the minimum amount required for each month. This way, you will be able to determine how long you’ve still got to pay off your debt. Furthermore, take the time to talk to a financial advisor who will be able to help you manage your credit card in a much healthier way.

Be very cautious of cash advances

While there may be some interest-free days available within your credit card plan; unfortunately, that doesn’t cover cash advances. Keep in mind that no amount of payment will ever be able to pay off cash advances as long as there is still an outstanding balance on your credit card; meaning, any balance you have on your credit card must be paid off first. Also, your benefit of having interest-free days will most likely be forfeited anyway until you pay off your cash advances first.

Always keep the fees down

You need to learn when to use your credit card so you can avoid getting hooked with unnecessary swiping; this way, you will only have a lesser amount to pay for your monthly dues. You must make it a point to always pay in full and on time to avoid any unnecessary charges piling up which can lead to financial downfall.

Look for alternatives in making payments

To date, people have the option to pay either over the phone or online. These routes are obviously much cheaper compared to paying over the counter.