Credit cards are now so much so accessible that you can even use them as a financial management tool if used well, and you can also take advantage of interest-free periods and various promotions to save money. But if the credit card is not used properly, it will increase the cost of using your funds, and if you still have the problem of overspending ahead of time, then sooner or later you will have a heavy debt dispute.
1. Don't overuse credit cards
Some people have a large number of credit cards in their hands, a dozen, an exaggerated point or even dozens. This is actually very risky. The number of cards is too large and inconvenient to manage, one of the reasons is that most credit cards have an annual fee, which is required if it is not swiped the required number of times or the required amount is not reached. If the card is not repaid on time, it will be overdue, resulting in a poor credit report record.On the other hand, too many credit cards and too high credit limits can affect the application for a new card, and even affect the application for a mortgage.
2. Overdraft
If there are no temporary large purchases, it is best to keep the total amount of credit card spending to less than $10,000 per month. This way, the pressure to repay is relatively low. Some cardholders have little self-control and often spend irrationally, using up their credit cards. When the repayment date comes, you start to worry, or bear the interest on the minimum repayment amount; another way is to repay in instalments and bear the bank's fees and interest, either way you need to give the bank an extra sum of money, and if it goes on for a long time, the snowball will get bigger and bigger and will leave you in debt.
3.Minimum repayment
It may seem convenient to pay back only ten percent each month, but this type of repayment incurs interest on your credit card. Most banks will calculate interest in full, whether it is paid or not, and you will pay interest every day, and the interest will increase every month. If your overdraft is not very high, you should pay it off in full.
4. Credit card cashing
Some people in the repayment period, repayment funds are insufficient, can only return the money in their hands, and then use the machine to brush the money out, in fact, this is still very risky, first of all, to bear the card handling fee, secondly, if you go to find a cash withdrawal intermediary, then the risk of being "fraudulent" by the intermediary is very high, if you use an unsafe POS machine, then the possibility of money being swept away by the POS platform is also very high. It should be reminded that credit card cashing is illegal and may be held legally liable once discovered and pursued by the bank.
