Credit cards can make your life easier. They offer you the chance to proceed with purchases that you wouldn’t be able to make otherwise. As you are not required to pay the full amount you owe right away, credit cards are often preferred to cash. Without carefull planning and wise use though, credit cards can easily turn into a living nighmare. To prevent that from happening, it is necessary to follow some basic tips that will help you modify credit card use to the best of your advantage.
How to modify credit card use to avoid financial ruin
Avoid carrying all your credit cards with you
Many people tend to carry all their credit cards with them when going out. By doing so, they get seriously tempted to use all of them to make purchases in various stores. They think that by using a different credit card for a different purchase they will manage to divide the cost equally, and therefore, pay less. Nothing could be further from the truth though. By using your credit cards in such a way, you end up charging all of them, and therefore, you have to pay more at the end of the month. Carry only one credit card with you at a time and decide beforehand exactly what you will buy with it. For even better results, pick a credit card with a small spending limit, so as to avoid getting tempted to spend more than you can afford.
Prefer prepaid credit cards
When using prepaid credit cards you have the chance to set your own spending limit. If you are afraid that you won’t be able to control your spending, choose a small spending limit for your prepaid card. That way, you will manage to both make the purchase you want and not spend more than you can afford.
Pay more than minimum monthly payment
By paying more than minimum monthly payment, you will succeed in paying not only for the interest, but for the balance as well. That means that you will manage to pay off your debt a lot sooner. Try to pay more than minimum payment every month. If that is not possible for one month, try to make up for it, by paying more the next month.
Pay before due date
Many people pay for the credit cards after due date. They don’t think it is a big deal if they are a few days late every month. While that may be true in the beginning, in the long term you are going to face serious problems, as collection agencies will start calling you and you will have to pay more and more with each passing month. Even if you can only pay for the minimum payment, try to pay it before due date to avoid extra charges.
Credit cards can help you or ruin you, depending on how you choose to use them. By avoiding carrying all credit cards with you, choose prepaid cards, pay more than minimum payment and before due date, you will get on the right track.