Smart credit card savings - how to get the best deal
A credit card can be a blessing. It can also be a curse, if you get stuck with a high interest rate.
09:35 12 December 2013
Getting a credit card can be a lifesaver, especially in emergencies. It can be a great way to purchase things you would not normally be able to find the money for, in one lump sum. There are some disadvantages, if you do not have the best credit you could end up dealing with high interest rates and yearly usage fees.
There are a few things you can do to make sure you get the best credit card deal possible and avoid problems.
- Create a budget prior to getting a credit card. This will give you an idea of what you can afford monthly. Choose a card that has fees you can handle.
- Make sure to pay on time. Lending companies will charge a late fee and interest, if you miss a payment. These fees can really add up.
- Stay well within your limit. Remember to account for interest charges and avoid over the limit fees by making sure to stay well away from your credit limit.
- Interest can make or break your ability to pay off your credit card. Minimum payments seem like a reasonable amount but they usually cover only the interest. Try paying double or triple your minimum payment if possible. You will pay off your balance faster and avoid interest.
- Do not take out more than you can manage to pay for. If you can only afford payments on two cards, limit yourself to those two cards. Many people end up filing for bankruptcy because they apply for every possible card, rack up balances and then cannot come up with the money to pay them off.
A credit card can be useful, and indeed a real blessing, in some situations. They can also be a serious financial problem if you do not use them wisely.