01 Nov Tips on How to Avoid Credit Card Debt
Everyone and anyone who owns a credit card is liable of carrying excessive credit card debt if purchases are kept out of control and unaccounted. Once excessive credit card debt occurs, it will take years of work and sacrifices to compensate for it. To avoid this, here is a compilation of a few tips on how you can tackle any such financial liability.
Have an emergency fund
Many people create credit card debt due to the lack of any access to emergency funds making them helpless to pay by credit card accumulating credit card debt. Keeping aside an emergency fund helps meet any contingencies by providing you with the necessary funds and avoiding credit.
Charge what you can afford
Avoid the deadly mistake of purchasing items beyond your budget and affordability. You can minimize and avoid credit card debt by buying essential items within your affordability and ability to pay for it.
Avoid unnecessary balance transfers
Prevent unnecessary balance transfers from card to card to avoid your due dates. Only transfer balances to another credit card with adequate reasons like taking advantage of low-interest rates. If not, it will only increase your balance because of the balance transfer fee.
Don’t miss credit card payments
By staying on track of your credit card payments, it will help you significantly avoid credit card debts. Avoid losing regular payments, as it would mean paying double the amount in the next payment besides with the late fee. This would strain your budget and tempt you to acquire more credit cards to meet ends meet.
Pay your balance in full each month
Inculcate the habit of paying off your credit card balance every month in full. Upon doing so, you will eliminate the risk of maintaining a balance and avoiding credit card debt. Keeping your balances settled incomplete means less worry about meeting minimum payments.
Recognize the signs of credit card debt
Many individuals fall under the trap of credit card debt because they fail to recognize the relevant symptoms and signs of credit card debt. Early detection of credit card debt can help avoid liability in significant ways. A prime example is when you realize you cannot pay off monthly balances in full.
Avoid cash advances
Cash advances are typically signs of early stage credit card debt and among one of the worst ways you could use your credit card. Concentrate on developing an emergency fund and fixing a budget, so you don’t have to avail cash advance in any emergency situations.
Limit the number of credit cards
The number of credit cards you own, the more you can charge. Unfortunately, it makes you highly susceptible to an even more substantial amount of credit card debt. So cut down on the number of credit cards in your wallet.