4 Credit Card Mistakes You Should Stay Clear Of


Today, I am going to throw a light on some of the gravest credit card mistakes. The truth is, I’ve survived a few of them myself. So without wasting any more time, here are 4 things you should avoid with your credit card.
Taking Cash Advances – You can say that a cash advance is the worst balance you can avail. There’s a simple reason behind this, they carry much higher interest rates as compared to a standard purchase.
You thought that’s it, wait, it gets a lot worse!
In case you decided to go with minimum payments, then your payments are allocated to the balance with the lowest interest rate first. Thus, your balance that has a high-interest rate stays untouched, making you pay more interest than you thought you would.
Making Big Purchases – Surprisingly, I’ve met and even talked to some of the people who have bought expensive cars using their credit cards for 0% promotions. The bottom line is that bigger purchases like buying a car should be made with the help of a secured loan.
For instance, you need to avail an auto loan, even if the credit is available on your credit card with a 0% promotion. The credit card interest on a large debt is going to be much more expensive as compared to the interest on an auto loan, boat loan, motorcycle loan, etc.
Therefore, you should use the apt lending products, which are specially designed for the purchase type you’re going to make.
Paying Hefty Medical Bills – I completed understand that we all need to fulfill our responsibilities, of course, they are important to us. However, if you can’t manage to pay for a medical bill, you need to save up until you can. Don’t simply put it on a credit card just because you can. There are mainly two reasons for this.
Firstly, a medical bill doesn’t fetch interest charges. So, the balance stays the same with time in several cases. Secondly, you can’t get sued for any past medical expense in the U.S. The bills may damage your credit, but no court proceedings whatsoever.
However, if you place your medical bill on your credit card, and later, can’t able to pay the minimum payment, you may invite harsh consequences in the form of medical debt.
Handing Over to Friends – Another thing that many have experienced and asked themselves, including myself is, How in the world, I have reached to all this debt?
It goes something like “My friend needed help, so I offered him/her help (my credit card) time and again for a few months. He/She promised to pay it all back, but didn’t have enough money to actually do it, ever.”
The truth is out, I learned my lesson when I put myself into debt by offering a helping hand to a friend. It was a horrible mistake because it not only affected me financially, but also ruined a great friendship.
I know to help the people we are close to, or love is important, and there’s nothing wrong with it. However, unable to keep a friendship or a relation at a distance from the financial business is only going to hurt you! Trust me, it’s not at all worth it.
Does this remind you of any mistake that you have ever made? Share it in the comment section below.

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