5 Things You Have to Know if You Own a Credit Card
As a cardholder, you have to be financially responsible and cautious when spending. Expenses these days will definitely crack your head out. It is so stressful and tricky at the same time. But here are some things you have to know to be financially free even if using unsecured loans like credit cards.
Interest is forever
Always expect interest regardless if you are a good payer or a rebellious revolver, there will always be a time that you will miss to make a payment in full and will incur expected or unexpected interest on your credit card bill. If you have been using a credit card for a long time you might be familiar with this. That’s why it is necessary to know your goal why you are having a credit card. Are you up for cashless transactions or a fan of enjoy-now-pay-later scam?
There are some credit cards that offer no interest rate or low-interest rate but don’t be fooled by those marketing strategies. The interest will pop up on your statement should you forgot to pay your bill on time. Make sure that you check your bill regularly or monitor your transactions online so that you will be well aware of the charges on your account.
Annual Membership Fee can be waived Waivers are considered normal if you are using a credit card. You can always ask for a waiver if you had a finance charge (interest), late fees or annual fee on your bill. But you have to expect that bank officers will always tell you that it is subject for approval and there is no 100% guarantee that waiver will be provided but you can always rebut and appeal.
You have to be careful though, some banks don’t really provide waivers especially if you usually default with your payments. You will know a few tips to request an annual fee waiver as well.
Spending too much can also help when it comes to requests for an annual fee waiver. Reason being is the more you spend the more points you earn. If you have enough points on your card you can use that to offset the annual fee. You may regret it at first for you can use the points to redeem rewards or buy coffee somewhere but it is worth spending.
Promotions will always be around
Online promotions are quite often these days, it is really tempting and somehow worth it. It is commonly offered to new cardholders, for they tend to spend more and use their cards shortsightedly.
There are pro’s and con’s when it comes to promotions. It is captivating if you see something on sale for 0% interest. But don’t be misguided, you still have to know if you need the item or it was just an urge and ego talking. Don’t get me wrong, some promotions are really helpful, commonly on airfares. It is a bit cheaper if you use a credit card buying airfare tickets.
You have to be choosy in taking some promotions and you must know the terms and conditions. No matter how overwhelming it gets, you need to take some time to understand how the credit charges work. Be mindful that your credit card can either help you or deceive you. Knowing the ins and outs of maximizing your credit limit will definitely give you an advantage on spending wisely. Indeed, promotions are amazing but make sure that you think before you swipe.
Billing Cycle and due dates
Part of credit card awareness is familiarizing your cycle and due dates. Whenever you apply for a credit card you should ask the bank officers your cycle date. Due date and Cycle date are different. Cycle date is the day where in your statements is generated, the due date is the day or deadline of your payment. Understanding these terms will give you a better perception of managing your monthly credit card bill.
In many instances, your due date will not coincide on your payday but remember that you can always ask your bank to change your due date so that you can pay your dues responsibly. You may not have this option at first mainly if you are a first-time card holder. Once you build a healthy credit score, you may be able to make such a request.
Credit card is a debt
As amazing as it may sound but a credit card is a debt you have to pay. It is easy money but it comes with a lot of cons that you should know before applying. Living luxuriously when it comes to a credit card is not easy, mostly because you have to make sure that you are capable of paying your monthly statement before buying a signature bag or a pair of shoes.
Always remember that you have to spend wisely and pay it monthly or else your credit score will be affected. If that happens it will be hard for you to apply for a new loan.
You need to weigh your needs and your options. Should you get a credit card or a personal loan? In case you opt for a personal loan, make sure that you get it only from a licensed money lender cash mart. Read the reviews about money lenders before choosing the best option. This way you can maximize its benefits.
You may not be familiar about your credit score but it is true there is are credit bureaus who records your previous loan information and payment behaviour. So be careful and live only within your means, even if you have a credit card. It does not guarantee you for a better spending life. Unlike other kinds of loans, the credit card is the most accessible yet the riskiest.