A credit card should not be an essential mean of survival. False maintenance of standards that we cannot afford for a long time usually costs us very expensive. Because this small plastic piece is one of the most expensive products and interest rates on credit cards go up to incredible 30 per cent. When we add annual fees, cash withdrawal fees and currency conversion, your card copy will definitely be a great surprise for you. Here are some tips on how to manage your credit card more painlessly.
Planning your home budget and keeping the record of your spending per card is one of the basic things you need to keep in mind when you have a credit card. As much as it is difficult to survive and “stretch” the salary by the beginning of the month, it is exactly the planning of consumption and purchases that saves us all from spending what we do not have in our wallet.
Unplanned purchases, in order to satisfy the feeling that we can still afford some kind of luxury, will usually cost us much more than what we can actually pay for. At the same time, keeping a record of spending on a credit card is the first and basic thing everyone has to learn. Because regardless of the monthly statements we regularly receive from the bank, only with our own records we can plan our spending, regularly repay the rates and remain within the home budget.
Do not buy food and home supplies with a credit card. Although the credit card is not a check on which the maturity date is entered, the same rule applies here as on the checks. Buying food that you will pay after months, repaying only five per cent of the amount spent is a trap from which it is difficult to get out. If you go to the store now and spend 5,000 on foods that you pay with a credit card, count that you will pay that to the bank until the deadline you specified, even though you will eat it for about ten days. And you will pay this interest to the bank for all these months!
Static Geek advises not to use a credit card as an easy access to cash. Although it is possible to raise cash with a credit card, this is the most expensive option to use the card. The credit limit itself is approved by paying interest to a bank which is one of the most expensive in the range of banking products. In addition, the model for calculating the minimum amount for payment implies that the total consumption includes membership fees, maintenance, as well as cash withdrawal fees at the ATM or bank counters.
Never repay only the minimum monthly debt repayment on a credit card – Although the obligation to repay only 5% of the credit card debt is very tempting, it’s a dangerous option, and you can be in charge for years. The minimum repayment of debt on a credit card is mathematically designed so that the debt lasts for a long time. The reason is that 5% of the remaining amount is continuously repaid.
Banks in this way earn very well in view of the very high interest they pay. In the case of debt on credit cards, interest is calculated every month, attributed to the debt, and interest is calculated on interest. This makes it easy for most of the debt to become the interest. The only way to bypass this trap is to repay a certain amount that will be greater than the minimum required by the bank.
Select the lowest interest rates. When making a decision to take a credit card, explore the entire offer on the market and then objectively assess which bank offers the most favorable card and brand. As in all forms of credit indebtedness, pay attention to one of the most important parameters – the interest rate that the bank will charge you for using the funds.
Also, if you make a payment by credit card, check what the most favourable variable is, which outlets your bank has a specially arranged cooperation with, and where you have the option of non-interest payment in multiple rates. In addition, note the dates when it is better to use the funds to avoid additional interest and fees. When raising money with the card, make sure that it is best to use a counter or ATM with the note that you use only your bank’s ATM.
Do not ask for a limit amount that is higher than what your wallet can actually bear. Although banks now offer everything, this does not mean that you have to be willing to accept higher limits or additional ‘’gift cards’’ on borrowed loans and the like. Be rational and spend only what you have.
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