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The Awful Mistakes With Credit Cards You Want To Avoid


July 18, 2019

Credit Cards

Credit cards can be a useful thing, especially in an emergency, as long as you use them correctly. The last thing you want to do is accumulate massive credit card debt because of a few mistakes. Below you will find some helpful tips on how to spot a card mistake and how to avoid them in the future.

1)The Number of Credit Cards You Have

That is probably one of the biggest mistakes customers make when they have a credit card. I have made this mistake too. I had a few cards open at one time. I accumulated a balance that was far beyond what I could pay down. I had to go to a credit card consumer debt company to get mine paid down, in full. It took me several years to do it, but it did teach me a few things.

Many experts suggest you keep one card open for your main purchases if you need to. You should also keep another card around for emergencies. Now, some financial experts argue you only need one around for emergencies. I guess it depends on your situation. You should keep this around for a guideline. That way you avoid the mistake of opening too many cards at one time, as so many have done and continue to do.

FYI: You cannot transfer your balance to a new card when they refuse to raise your limit. A lot of people have tried this in the past. Life does not work that way.

2)Introductory Terms and Conditions

This is another mistake that a lot of customers make. Most companies know their clients are not going to read the contract, though they should. Most people do not want to read a book with a lot of technical jargon and information. However, it is important that you read through at least some of the terms and conditions. You need to know what to expect and when.

Companies have a way of throwing wrenches into the plan when you least expect it. You begin with a 0% rate, and then, you find that it has been raised to a 28.99% APR annually.

Most plans that begin with a 0% rate are going to dissolve after the first year. They will raise the rates on you, especially when you have accumulated a balance that you cannot afford to pay down right away.

They make money from your unpaid balance. You will pay more in interest rates than you do for the initial balance. You could go from a $200 balance to a $1,000 balance in as little as one year. That is how it works for most card companies. Your numbers may vary.

The point is, your $1,000 balance is more interest rate than actual balance. That is why you need to read the terms and conditions carefully. I have made this mistake too. I am learning along with you.

3)Too Good To Be True

"If it sounds too good to be true then it usually is."

Do you remember the fairytales your mom used to read to you when you were a lot younger? You sometimes walked away thinking. "I do not believe that could ever happen."

The same rules apply here too. Part of the card companies job is to make you an offer that is too good to refuse. That is how they rope you into the deal. Then, they start changing the storyline once you get hooked.

Once again, this is their job. That is why you have to read the fine print more carefully. If it seems like a fairytale offer, then it probably is.

4)The Right Card

You have decided to get a credit card. You better choose one that fits your lifestyle and spending habits. That way you can get some of the advantage points and cashback rewards. Otherwise, you will walk away with points you cannot use. You will also walk away with a big balance you cannot pay down.

5)Pay It Down

This is a problem that I have had issues with too. You buy a lot of stuff, and then, later, you come to find out that you cannot pay the bill. You think that you will be able to, but life finds a way to get in the way.

"Life is what happens when you are busy making plans."

I have also gotten into trouble with this mistake, so I know what you are going through. You maintain that you can pay it down in "good faith", but that does not happen.

Only charge what you can afford to pay down at that moment. Learn to hold off on buying things until you can afford it.