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Tips use Responsible Credit Card

Having a credit card in your possession can often be a recipe for debt and despair. Luckily, it is entirely possible to manage your credit cards responsibly while still taking full advantage of the convenience and rewards that they offer you. Simply follow these easy tips.

  • Start off slowly: If you have never had a credit card before, it is wise to start off slowly. Apply for one card to begin with and insist on a low credit limit. This will make it easier to avoid the urge of spending just for the sake of it! Use this credit card for a few months and get used to paying off the amount that you owe. After a while, you will feel comfortable adjusting your credit limit or applying for another card.
  • Never use more than 70% of your credit limit: If you constantly reach your credit limit month after month and you are not paying off your debt in full, you will start to earn yourself a bad credit score. By spending less, not only will you impress lenders with your ability to control your spending, it will also leave you with enough available credit to use in case of an emergency. 1
  • Monitor what you are spending: It can be easy to get carried away with your spending when you are not paying cash for your purchases. This can often lead to over-spending on your budget. To avoid this, keep track of everything that you buy using your card, as well as the amount that you are going to have to pay back.
  • Do not use your credit card for everyday purchases: It is best to use cash or a debit card for everyday purchases and to save your credit cards for when you have to buy something slightly more substantial such as a washing machine or new tyres for your car.
  • Pay off your credit card in full every month: Not only will this act as a deterrent for ‘spur of the moment’ spending, it will also look great on your credit record.
  • Get help if you need it: If you find that you are beginning to slip into debt, get help quickly. There are many debt counselling professionals out there who can assist you and provide you with a plan of action. Alternatively, you can speak to your bank about taking out debt consolidation loans according to your needs and the severity of the situation.

Ultimately, in order to use your credit card responsibly, you need to monitor your spending closely, try to spend less than your credit limit, pay off your debt in full every month and get help should you ever need it. Also, never be afraid to speak to your bank regarding your financial needs and concerns.