Do you think credit cards are only used to finance purchases? Initially yes, but you should know that the handling of credit cards goes beyond accessing goods and services quickly and conveniently. The habits you have with these instruments will determine if they are a tool in favor or a headache.
The belief that credit cards can lead to many financial problems is associated only with their misuse and not with a fixed reality. So the intelligent use of these instruments will be key, so that they are allies and not obstacles in achieving goals.
We do not always have as a priority to think of strategies that help us to improve the management of our finances, however we should give it greater importance, because our present and future will depend on it.
Do you want to know the secret of good credit card management?
In this article we share some useful practices that can be applied to improve your financial life.
Always pay more than the minimum
It may sound cliché what you are going to read, but the truth is that paying more than the minimum on the credit card , is one of the most effective practices not only to maintain a credit history of 10, but to accelerate the settlement of debts.
Paying only the smallest amount that the bank establishes each month to repay the debt, will eventually end up paying a much higher amount of the credit you used, thanks to interest.
Use credit cards in an emergency
Using credit cards in emergency situations is one of the smartest financially speaking practices. In general, unforeseen events usually require a lot of money, an arrangement of the car, an unexpected hospitalization, are some of those cases.
These emergency situations cannot be postponed because sometimes even life is at stake and credit cards are the perfect tool to cover important expenses. You just need to plan well and make sure you have a good plan to pay later.
When it comes to good credit card management, avoiding using them in superfluous expenses, such as going to the movies or manicure at the hairdresser, is the best option.
Using the credit card for minor expenses will only be a good idea, in case you are thinking of liquidating 100% of that financing on your next payment date.
Travel and advantages of offers
There are banks that when you travel abroad offer you offers according to the credit card you own. You can get discounts on air tickets, access to presales, discounts on hotels and more advantages for accumulation points and other benefits.
You just have to contact the bank issuing the credit cards and consult the advantages that you can access and the conditions that apply for each offer.
Buy durable goods
You can use your credit cards to finance what you consider, however, to buy durable goods such as appliances and appliances that serve you for study or work and that over time will be worthwhile, it is the smartest financially.
In the end, these goods can not only benefit you at work or personal level, they can also end up being an investment that generates a monetary value if you need it in the long term.
Annual commissions and how they can affect you
Obviously banks have a lucrative credit card business. These earn a profit from the so-called financial margin, which is the difference between what the institution gives the saver for saving their money and what they charge for the use of that capital to the cardholders.
But in addition to the aforementioned gain, banks also obtain a commission benefit, which can represent up to 50% of their total income.
Depending on some cardholder habits, banks benefit more or less in most cases due to ignorance and lack of financial education.
In accordance with the above, it is necessary that you learn to have a correct handling of credit cards, so that your financial stability is not affected by said commissions. To do this, consider the following:
- Avoid having more than two credit cards, otherwise you run the risk of ending up in debt and paying commissions everywhere unnecessarily.
- Keep up to date with your payment dates , since forgetting to cover your fees you will have to assume commissions that the bank will charge you for late payment.
- Avoid cash withdrawals. Many people believe that withdrawing money from a CT is the same as doing it from a debit card, when doing so from the first you will have to assume a commission of between 5 and 10% of the amount provided.
- Propose to dispense with financial services that you do not use or get any advantage of, since they only charge you annual commissions and you do not get a tangible benefit.
Do not exceed your credit limit
This may seem difficult, especially if you tend to use the credit card as an extension of your salary, which you should avoid at all costs. Ideally, you should structure your expenses and use financing only on the most important things, not on current expenses.
When you avoid using CT for any type of expense and allocate it only to purchases or specific needs, you are minimizing the possibility of exceeding your credit limit.
But suppose that for some reason what did not have to happen happened and you exceeded the credit limit. Do you think everything is lost? Not at all, in fact, you can currently count on the service of Euro Lend to settle your debts in a comfortable way.
How can Euro Lend help you with your debts?
Very easy, through its service you can defer the balance of your credit cards and then pay them in a comfortable way in terms that you can choose according to your needs (3, 6, 9, 12 or 18 months).
The correct handling of credit cards can avoid headaches in the long run, the ideal is that you document yourself on all the details, benefits, advantages and duties that encompasses the use of these financial instruments.
Proper credit card management will allow you to maintain a clean credit history with the Credit Bureau and will open the doors for you when you need to apply for new loans.
On the other hand, you should not see credit cards as harmful elements for your finances, on the contrary, take advantage of their advantages to finance what you like most and achieve your goals.
If you currently have cards and you are mortified by not knowing what to do to pay them and not be wrong with the bank, remember that you can resort to the service of Euro Lend, defer balances and get more time to pay credit cards.