Feeling the pinch from your Credit Card in the post-holiday washup? No need to panic. Greater Branch Manager Gary Luck has some simple tips to help you avoid Credit Card debt.
It’s usually around this time of year that we start getting our credit card statements for the Christmas and New Year period. Coincidentally, for some of us this is the time of year we begin to swear off Credit Cards for life.
But before you reach for the scissors, just think for a moment. Your relationship with your Credit Card hasn’t always been this bad, has it? Remember the good times, like when you were able to take advantage of that Plasma TV sale in between paydays? And what about that safe and warm feeling your credit card gave you when shopping online?
Okay. So now we’ve managed to calm you down, it’s important to think about what led you to this point. Chances are you’re unhappy with your balance, and the very creative range of fees and charges your bank imposes on your spending. Are we getting warm? Thought so.
What if we told you there was a way you could enjoy all of the things you like about your credit card, and avoid all the things you don’t? Sounds too good to be true, but it’s not. It turns out avoiding Credit Card debt isn’t all that difficult – check out our handy tips below.
- Don’t miss payments – this may seem elementary to most of us, but sometimes we can be tempted to skip payments to make it up the month after. You should avoid this if you can, as your bank will likely charge you a late fee, your interest rate may increase making your balance grow, and the missed payment may affect your credit rating.
- Avoid cash advances on your card – if you need to draw cash on your credit card, there’s probably something wrong with the way you are handling your finances. Avoid drawing cash on your card at all costs, and work on budgeting your money better!
- Charge only what you can afford – Again, may seem pretty simple, but too many of us are getting in too deep when shopping with our card. A good way to look at each purchase is – if you can’t afford to pay cash for it, should you be charging it to your card?
- Avoid balance transfers – Take this with a grain of salt. If you have a good reason for transferring your balance, like a great low rate, then do your research and go for it. Transferring for no reason is likely to inflate your debt due to balance transfer fees. You should also remember that balance transfer teaser rates are just that – teasers. They won’t last forever.
- Know what you’re doing with rewards - It’s important to read the fine print if you’re signing up for a rewards credit card – more and more often consumers are paying more than the value of the reward due to hidden fees and high interest. Buyer beware.
- Have an emergency fund – This can be easier said than done in practice, but it makes sense to put money aside in the event of something unexpected. That way, when the muck hits the fan, you are covered by your savings rather than having to reach for the plastic in your pocket. A high interest savings account or Term Investment is perfect for this – you are rewarded for locking away your savings.
- Speak up – if you get into trouble with your Credit Card balance, the worst thing you can do is just hope it will go away. Speak to your bank to find out what they can offer you so you can lower your debt effectively.
- Pay off your balance whenever you spend – Probably the smartest tip when using your Credit Card. Pay off your balance in full if you can, but if you can’t be sure to pay off as much as you can – never simply pay the minimum amount on your statement.
By adhering to these handy tips, you can make sure your Credit Card balance is kept under control, and that this time next year, you don’t find yourself in the same position standing over the bin, Card and scissors in hand.
The Greater offers a simple, low rate, low fee Credit Card that is easy to use. Everything you need and nothing you don’t. If you would like more information on applying for a Greater Credit Card, why not:
If you have a tip that has helped you avoid Credit Card debt, why not share it below in the comments?