Using Credit Cards Wisely
From Financial Literacy Wiki
Using Credit Cards Wisely
As you have seen in Bank Credit Card, the effective interest rate imposed on unpaid balance is about 26.82%. Thus it is absolutely necessary that cardholders use their cards wisely.
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Buy Goods & Services that are Essential
Purchasing by credit card is a cashless transactions. As there are no exchange of cash during the transactions and the ease of effecting the transactions, credit cardholders tend to buy goods that they do not really need. Thus it is essential that cardholders purchase goods and services that are absolutely essential and budgeted for.
Pay Bills Promptly
Cardholders usually tend to make payment a few days before the payment due date. It would be better to ensure that payment has reached the bank long before the due date is near to avoid any dispute. Always mark on your calendar the payment due date and mark out a day that is around a week earlier than the payment due date to make payment.
Borrow from Other Sources
Try to minimise the interest payment by seeking loans that have a lower interest rate than the credit card effective interest rate. You can turn to your overdraft, as an example.
Don't Use Up Credit Limit
Avoid spending up to your credit limit as you will not be able to use the credit for emergencies.
