Credit Card Mistakes to Avoid
Credit cards are very essential tools. You could travel the world free of charge if you knew how to use them well. Experts can make a lot of money or actually use them to provide a large amount of cash back. Low-income families could use these same tools to lighten their financial burden. Improper use of credit cards could be a total disaster. Here are some of the common mistakes that you should avoid by all means.
Opening many credit card accounts is suicidal and should be avoided. Please avoid it. It’s a wrong thing to do. Here is why you should not: It’s easy to lose track of your spending. Each account opening could stain your credit card score. It will be hard to take advantage of available rewards. Wait until six months before you could handle another credit card.
It is good to always pay the balance every month. Credit cards are a form of revolving credit and therefore you should pay your balance in full every billing cycle. Failure to do so, the charges you’ve accumulated are rolled over to the next billing cycle. Your balance can only be rolled over after an interest is charged on the balance. People who get into this habit are denied the privilege of receiving rewards. Profits accumulated by you could also be cancelled.
Many credit card holders are tempted to close down their accounts. Closing their accounts down due to lack of activities in them appears to be the finest decision to make. According to credit card experts, that’s absolutely wrong. Do not close your account simply because you had debts and paid them off. Therefore feeling it’s not important to keep your account. Such actions will only affect your credit score negatively. You credit score will be negatively affected even further if you decided to open a new account to replace the old one.
Cash advances decision: This is not a good thing to do. Sooner or later you will be visiting WireLend to take out a loan to pay off your cards. An interest rate of several points higher than your APR is usually carried by cash advances. Not only that, interests start accruing immediately while you have been subjected to a host of fees.
This last point may sound ridiculous. But it is anyway. Free money is seen thrown away by most new credit card users. Ignoring all the advantage of services that most credit card companies offer. Since most credit card companies offer a free Vantage score, try to follow the directions given to obtain such bonuses.
Final word. Any new person to the credit card game should always play it slow and smart as advised by credit card experts. Cards with annual fees should be avoided by new users. Anybody who uses their credit card properly will discover the many benefits that come along.