Improve the use of your credit card
The acquisition of a credit may be of great help in terms of using it when purchasing things or as a paying option but there are some things you need to aware of. By planning its use carefully and using it right, you can get the most out of it.
1. Do not go into debt on the basis of assumptions
No need to acquire debts based on future business. Many people say that they will ask for a loan so that they get the money they need for their cards. You should only rely on the money you earn monthly.
The importance of planning your debts is great and what is recommended is separating your expenses by category. You should have no amount slips or invoices. You know you have balance because you accept the card so you should know how much money you spend.
It is also advisable to place the date of payment at most five days after the day you receive your salary. There are a lot of people who ask to pay their cards on the 28th but when that day comes they no longer have the money to do so.
3. Minimum pay
It is always advisable to pay the minimum. That is the most expensive because the interest accrues. You must be careful with what you have available to pay in installments. Therefore, once you know your minimum pay, you should save up the money needed just for that and be careful not to spend that amount.
4. No cash withdrawals
A credit card may serve as an alternative, but you shouldn’t rely on it when in need of cash. Withdrawing money is the most expensive thing to do because the interest rate is between 90% and 100%. If you want cash you should borrow it.
5. Reprogram your debt
If the due date is approaching and you know you will not be able to pay, go to the bank and ask them to extend the deadline and / or check if it is possible for you to have a fee reduction.
This case is called refinance and banks should increase their provisions. Reprogramming, though, can be done easily too.
6. Debt Purchase
If you are constant on paying the minimum on a card, you can easily get out of trouble. Go to another bank and have your debt bought by it. That bank will charge lower interest. It is the best mechanism to solve the debt overhang.