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Don’t have a credit card yet? Chances are you might someday, and while credit cards can be really useful, they can also get out of control if you’re not careful. In the interest of being prepared (like a good boy scout), here are our tips for keeping your credit card under control.
Credit Card Wrangling for Beginners
Leave it at home
Seriously, it just doesn’t get any easier than this. If you leave your card at home you will enforce the smart spending rule of ‘take a minute’ before you buy. This can help stop you buying on impulse and at the very least will give you the time it takes to go home and get your card to think about whether you really want to spend the money.
Do a budget
We know – it’s that b-word again. But a budget really can help you have better control over your money, which may mean you have actual cash money to use to buy things.
Save it for emergencies
Yes there may be times when you actually do need to pay for something today – and this is when your credit card can be really helpful. Just remember that if you spend all your credit on other stuff, you won’t have anything left to cover your emergency.
Pay more than the minimum
Whenever you get a credit card statement, it will show you a minimum repayment amount. It’s worth noting that if you only pay this amount, it may take you a LONG time to pay off your debt and you may pay a LOT of interest doing so. If you can’t pay off the amount in full, pay as much as you can.
A note on interest-free periods
Most credit cards offer an interest-free period. This is where you have a number of days where you are not charged interest on your purchase. Something that isn’t always clear is that you only get this particular perk if you have paid off the total amount the month before. So, unless you pay off your whole credit card bill, you’re paying interest! Also keep an eye out on when the interest free period starts as some people mistakenly assume it commences from the date of each purchase as opposed to the relevant credit card payment cycle.
As a final note in your credit card apprenticeship, if you find that you are regularly spending more money than you can pay back each month OR if you aren’t using your credit card how you thought you would, it may be time to reconsider having one altogether. Credit card debt can be overwhelming – if you need help ask one of your grown-ups or check in with your bank.
