Managing Credit Card Debt

Credit cards are proof of modern financial sophistication today, who doesn't know the ease of using a credit card? Just swipe the card and the transaction is successfully made. Not only the ease of transactions, but credit cards also usually offer many discounts and cashback for every use. However, among the conveniences of using it, there is an important thing that must be considered, namely "Managing Credit Card Debt".

Illustration (Source: thehealthjournals.com)

There are so many pluses that credit cards offer their users, but did you know that being unwise in using a credit card can be a problem for you? Most people think credit cards are a place to go into debt, because of the convenience for people who are overwhelmed when they have to pay bills.

How To Manage Credit Card Debt

Getting a credit card for the first time is a very happy thing. Usually, you will have a lot of plans with a new credit card. Mistakes in using a credit card are usually made by many novice credit card holders.

In essence, a credit card is a means of payment that makes it easier for you if used wisely. Credit cards can be one of the tools to manage monthly finances, especially if you choose to pay via credit card.

Here's how to manage credit card debt for beginners, as follows:

• Choose a Credit Card that Suits Your Needs
• Don't Use Many Credit Cards
• Close or Non-Activate Rarely Used Credit Cards
• Adjust Credit Card Limit To Income
• Use Credit Card For Transactions You Can Afford
• Research Before Transacting
• Do not make cash withdrawals with credit cards
• Don't Pay the Minimum Bill
• Don't Lend Credit Cards to Anyone
• Keep your Credit Card Data Confidential

Choose a Credit Card that Fits Your Needs

There are many credit cards that banking financial institutions offer with a wide variety of attractive offers. Choose a credit card that suits your needs, for example, if you want to use a credit card as a means of payment, then choose a credit card that offers many discounts and shopping cashback.

Don't Use Many Credit Cards

It's not a problem to have more than one credit card. But what you need to know, the more you have a credit card, the greater the costs that must be incurred. Each credit card usually has an annual administration fee, late fees, bill printing fees, and others.

If not used wisely, having multiple credit cards will make your shop more often without thinking. Credit card bills will swell every month, and this will be a burden, especially for credit cards that are owned by more than one.

Close or Disable Rarely Used Credit Cards

Don't let yourself get stuck with all the conveniences of a credit card. If you already have more than one credit card, immediately close the one that you don't need. But before that, make sure all bills have been paid first, yes.

Adjust Credit Card Limit with Income

In general, a credit card will provide a limit of two to three times your salary. However, that doesn't mean you have to take the limit. Always use a credit card within reasonable limits and make sure the bill is not greater than the monthly salary.

Use Credit Card for Transactions You Can Pay

As explained at the beginning, credit cards are not a place to owe the debt. Credit cards are a means of payment that facilitates transactions. So, don't buy things that you can't afford to buy in cash.

It's a good idea to use a credit card to pay for important things. This method is very powerful to avoid credit card debt that is too large.

Research Before Trading

You may be tempted by a 0% installment credit card promo or a 70% discount with a credit card. Don't be tempted yet, even if you get discounts and low interest, the credit card limit will still decrease according to the value of the goods.

Do Not Make Cash Withdrawals With Credit Cards

Credit cards have a cash withdrawal facility. This facility is very possible to take cash through ATMs such as express loans. Behind the ease of cash withdrawals with credit cards, there is a large interest rate of around 2.5% every month. If the bill is not paid on time, interest will continue to grow.

Don't Pay the Minimum Bill

Again, credit cards provide ease of payment. You're usually allowed to pay the minimum bill of the total bill, for example, the minimum bill is 10% of the total bill. This means that you can pay 10% of the entire bill in one month. But this method is very detrimental to you because the interest will continue to run over time.

Check monthly bills carefully

Once the credit card bill is received by email or mail, make sure you check it first. Check all transactions in a month, don't let there be transactions that you don't make but are listed on the bill.

After making sure there are no 'stealth' charges in your credit card transactions, note the important dates listed. This important date is usually the due date of the bill.

Don't Lend Credit Cards to Anyone

Don't let the credit card fall into the hands of others. Even if he is the closest person to you, the credit card you have may be misused. This will be fatal if the credit card is used without responsibility. It could be that the monthly bills swell out of plan.

Keep Your Credit Card Data Confidential

Always remember, a credit card is one of the objects that is closely related to crime, especially burglary. It will happen unknowingly, therefore it is very important to maintain the credit card data you have such as pins, credit card numbers, and personal data of the owner. In addition, be careful before making a transaction, make sure there is nothing suspicious in every transaction. Don't give your credit card pin to anyone.

Hopefully, this information about "Managing Credit Card Debt" will be useful to you.

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