There are currently 15.5 million active credit cards in circulation throughout the nation. On the average, $22 billion is spent on credit cards every month, according to RateCity. They have come up with 5 important traps in credit card spendings throughout the holidays, causing financial collapse on the last month of the year. Here are the things you should avoid:
Shopping using your card is very different from shopping with cash. Be aware of your spendings as this is often overlooked when using credit cards. A better alternative is to use a debit card to control your finances while shopping.
Although convenient in the short term, minimum repayments are costly. Most credit card companies charge a minimum of just 2% of the card’s outstanding balance. Following this scheme takes longer to pay, as most of the amount is allocated to the interest.
Cash advance will cost you. Interest rates can go as high as 29.49%. Also be mindful of charges up front, such as withdrawal fees and interests.
Introductory and balance transfers can be costly if these are not paid religiously.
Be aware of Excess Fees; always inspect your bill meticulously for any hidden charges.
Ensure that credit card expenses are checked religiously. 11 months of keeping your finances in check can go down the drain if these pitfalls are not avoided this holiday season.
Read more on the Property Observer website.