Think You're Not Making Credit Card Mistakes? Think Again

Monday, November 07, 2016

Think You’re Not Making Credit Card Mistakes? Think Again

Credit cards are tempting to use for anything and everything because they are convenient and fast. But, I think you know where I’m heading with this one, ladies. They are very bad news if you don’t use them right. Yup, I’m referring to debt and even bankruptcy.

Here are some of the errors that I see many women making, without even realizing it, and ways to stay out of the red:

Not Realising that Your Credit Card Spending Patterns are Tracked

While it is important to consider your credit card purchases from a spending and saving perspective, it is just as important that you understand your “credit card spending behavior” will be tracked and collated into a “score”. This score will be used as a reference for any future lending applications that you might make. So good credit card patterns can lead to better lending deals later on, which may save you thousands.

Not Paying on Time

When you’re late by even just a few days, the credit card company charges you a fee. Late by more than 30 days? You’ll see your credit score declining when this happens.

Instead, pay on time and save yourself paying more than you need to do. It sounds obvious, but there are still women not doing this when they first meet with me for financial guidance.

Keeping a Balance

An outstanding balance on your card not only negatively impacts your credit score but it also is going to cost you a lot of money in compounding interest. Save yourself having to pay exorbitantly high-interest rates by not charging more than you can afford to pay off in full by the month’s end.

Maxing Out the Credit Card

While no woman ever intends to max out the charge card, it can happen. The result is not only a financial headache but also a penalty for your credit score as the bigger percentage of your credit that you use up, the more your score suffers. If you are trying to improve your credit score, try only to use up to ten percent of your available card spending limit.

Have a Strategy in Mind

Please understand I am not saying credit cards are bad. No! In fact, they offer better security protections than debit cards and can settle disputes with retailers. For big purchases, credit cards are best, and you can even get additional warranties on what you buy with some cards.


Here is your No Risk Action Plan:

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