Part of the reason people decide to get credit cards is the convenience that it offers. Imagine going to the grocery store to buy dinner and using a piece of plastic to pay for everything. It’s amazing.
Because of the convenience that these cards offer, people can sometimes take it for granted. And when that happens, mistakes are made. Mistakes that otherwise, would have been avoidable in the first place.
Here are some of the most common mistakes credit card holders make and how you can avoid it:
Forgotten bill payments
Banks often put you in one of their bill cycles. It's very easy to miss especially if it's sometime in the middle of the month. With the services offered by technology and the bank itself these days, people have no excuse in regards to forgetting to pay their bill on time.
How you can avoid it: Set an alarm on your phone at least two days before your due date every month. Another way is to setup your account online to make the minimum amount required so that your bank can just pay it automatically on your behalf. Your primary concern now is making sure that there is money to be transferred every month from your account.
Loans usually take the top of people’s priority list. Because they tend to rack up interest if unpaid. When people prioritise their loans over their other bills, you can expect their credit score to drop.
How you can avoid it: While you’re paying off loans, don’t forget that you also have a responsibility to the bank. Budget your income carefully, and for a time, avoid splurging on trips, and instead of getting Starbucks, bring your own coffee to work. This way, you can pay off both your loans and credit card bills on time and your credit score won’t have to suffer.
Not reading your bills.
Everything these days are automated. Since most people get their bills through email, it's quite easy to miss it as it can easily get buried under a ton of other emails. Plus because of automation, people don't bother to check their bills properly because they know that their accounts can pretty much handle their own. This carelessness can allow you or miss any discrepancies you could have otherwise talked to the bank about.
How you can avoid it: Create a filter on your email so that all your bills will be filed under a folder especially for your bills. This way, your bills will be in one place, allowing you easy access and it won't get lost under a sea of other mail. Now it's easier to sit down, open your email account and carefully check each bill before they charge it to your account.
Maxing out your credit card
Especially for new credit card owners, it can be pretty hard to control their spending after seeing a piece of plastic pay for everything they have ever wanted. Because of this spending habit, they max out their credit card in just a matter of weeks, rendering their cards useless and incurring a large bill.
How you can avoid it: The best way to prevent yourself from maxing out your credit card is knowing your limit. Know your limit for each card, and keep all the receipts for each purchase made. This way you can keep tabs on how much more you can spend and how much you have to pay for your credit card bill.
Know these mistakes and learn from them. Careful budgeting and keeping an eye on your bill at the end of each month can always go a long way. We hope that these tips can help you become the best credit card holder you can be.