Shopping sprees are good when you have cash in hand. Credit cards, no doubt, are useful for modern convenience. Without credit card these days you might not be able to make a hotel reservation, book a flight ticket or rent a car. It also helps you in buying your favorite product when you want to, or when it’s in discount. But this way when credit card becomes something you start relying on for your everyday expenses, debt starts building up.
The general financial advice regarding credit card debts is that it requires a healthy dose of discipline to avoid. Improving the habit takes time but the ultimate result is worth it. The only way to avoid excessive credit card is having cash in hand. So
In many cases, credit card debts build up after a major car repair or medical expense. These kinds of situations force people to use credit cards to pay off the expenses, as they do not have any savings to fund these. So, it is very necessary to have an emergency fund. This is the best way to avoid credit card debts when an emergency arises.
It is a simple calculation, if you can’t pay something in cash you really cannot afford to charge it. In fact, this is the best way to avoid credit card debts. Do not buy something which you really cannot afford.
It is a bad idea to transfer the balance from card to card for avoiding your due dates. If at all you are thinking of doing that you better have a good reason, for example, taking advantage of lower interest rate. The card transfers lead to summing up of balance transfer fee.
It is very important to clear out all your credit card payments on time. As you miss any payment, the next one will just be higher than the previous as the two months will add up. And don’t forget about the late fees. When all of it adds up, it becomes tougher to pay off and tampers your budget, in turn tempting you to use your credit card even more.
If you are paying your balance every month, it becomes easier to avoid credit card debt. This makes sure that your credit card will never carry a balance and eliminate the risk of getting a debt. This way you are also wiping away the tension of meeting the minimum payment as the credit card amount has already been paid. You got to make sure that you are spending only as much as you can pay off in a month.
It is often found out that people go through credit card debts as they don’t even realize that it’s coming their way. If you manage to understand the early warnings, you can avoid the debt in the first place. The best credit cards the UK provide comes with the facility that the company sends you a notification about your dues.
You must know that if you are taking cash advances, you are most likely to have some financial troubles. If you have to use your credit card to get cash, it means you are in big trouble. Or else you would have drawn cash from your bank account. So, this is like the first stage of credit card debt.
It is the worst mistake you can do. Lending your credit card means you have no control over how the person uses it. The accounting services gets distorted. Even if they claim that they will pay the bill, it is ultimately them who are responsible for the charges. If they decide not to pay you back then it’s all on you.