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Getting a credit card can be an exciting step for many people. It can be a useful tool for being able to pay for something which you don’t necessarily have the cash for upfront. Being able to use a credit card to pay for something in small installments can make affording things much more feasible.
There are lots of ways that a credit card can be useful for your quality of life. Whether you’re an entrepreneur trying to fund marketing your business, or you’re a parent trying to put food on the table. The important thing is to remember that a credit card doesn’t come without strings attached. It’s crucial to remember that you will have to pay the money back and be responsible for the card you hold in your hands. When it comes to being careful, make sure that you look out for the following common mistakes.
Not Monitoring Your Statements
When you have a credit card it’s important to keep an eye on the charges which are coming out. If you don’t keep a close eye on your list of transactions then you may miss something which was important.
It’s common to be charged twice accidentally, or even be a victim of fraud. When this happens it’s important to be able to identify it as soon as possible so that you can report it to your financial institution. Otherwise, you may not be able to recuperate the money.
When it comes to paying off your credit cards, it’s crucial that you respect the due date. By paying even a day later than the date listed on the bill, you will put your credit score in jeopardy and may face late fees.
If remembering payments is difficult for you, then you may want to strongly consider signing up for automatic payments. This way it comes directly out of your account without having to remember or do a thing.
Maxing It Out
Even though you may have been given a certain credit limit, that doesn’t mean that you should use it all.
The closer that you get to your maximum credit allowance, the bigger impact that this will have on your credit score.
Lenders want to see that you’re responsibly using your credit rather than depending on it for your main source of money.
Paying The Minimum Due
A common mistake that many people make when looking at their credit statement is believing that the minimum due listed is the amount that they should pay.
Instead, they should pay as much as they can in order to get out of debt as soon as possible. This way they won’t be paying interest on top of what’s due.