Mistakes Credit Card Holders should Steer clear fromHaving a credit card is very useful. When used properly, credit cards could enable you to travel the world free of charge. Making a lot of money using credit cards or using them as cash back provider has been an experts' trend. These same tool can be used by a low-income family to adjust their financial burden. Things can get a little messy if a credit card is not used accordingly. Here are some of the common mistakes that you should avoid by all means.
Never open many credit card accounts. Please don't. It's a nasty and awful thing to do. Here are the reasons: It's easy to lose track of your spending. Your credit score could easily be affected. It will be hard to take advantage of available rewards. If you feel you can handle more cards, make sure you have at least six months.
It is good to always pay the balance every month. Credit cards are a form of revolving credit and therefore you should pay your balance in full every billing cycle. When you are unable to pay your balance in full, the charges you've accumulated revolve to the next billing cycle. Your balance can only be rolled over after an interest is charged on the balance. Rewards are never allocated to people who possess such habits. There is also a risk of all your profits being nullified.
Many credit card holders are tempted to close down their accounts. Closing their accounts down due to lack of activities in them appears to be the finest decision to make. Credit card experts do not support such decisions at all. Closing cards as you pay off your previous debts is not advised at all, just store them safely. Therefore feeling it's not important to keep your account. Such actions will only affect your credit score negatively. The worst happens when you decide to open a new account to replace the previous one.
Going for cash advances: This is not a good thing to do. Taking a cash advance will definitely lead you to WireLend to take out a loan to pay off your cards. Cash advance carry an interest rate of several points higher than your APR. It doesn't end there, you will also be required to pay a host of fees while interest begins accruing immediately.
This last point may sound ridiculous. Of course it is. Free money is seen thrown away by most new credit card users. Not taking full advantage of services that most credit card companies offer. If you open an account that has sign up bonus or any other bonus, do your due diligence to collect your bonus.
Final thoughts. Any new person to the credit card game should always play it slow and smart as advised by credit card experts. Cards with annual fees should be avoided by new users. Use your credit card properly and discover how you could benefit abundantly.