Credit cards are created for your convenience in making transactions.
However, if it is not used wisely, a credit card can be your traps, so you are difficult to escape from the traps.
Reporting from thebalance.com, here are 5 effective ways that you can be free from the credit card traps.
1. Don’t use a credit card at all
The easiest way to avoid the trap of a credit card is not to use it at all. However, if you feel you need a credit card such as for a vacation, then you can use just one, but only for holiday purposes.
If you depend on a credit card, then you must identify the reason you need it. If your income is not enough to pay a monthly bill, then you should think about side jobs. Furthermore, if you find that shopping is excessive because there is a credit card, then you should replace the cash payment method for all your expenses.
2. Don’t take credit cards anywhere
You might want to have a credit card for emergencies or help deal with financial flows. If this is the reason you want to have a credit card, then don’t take credit cards anywhere. You can take it while on vacation or other trips, or when you feel like you will encounter a situation where your credit card will be useful. Apart from that, it’s better to leave a credit card at home.
Not carrying a credit card can put a brake on its use for impulsive shopping. It also helps you make sure that before buying an item, you know that you really need it.
3. Pay on time and the exact amount
If you use a credit card to get reward points and you want to use them, then make sure you pay the bills on time and the right amount. You can also monitor credit card usage according to the budget each month.
Remember that the reason banks or credit card companies provide reward points is to motivate you to continue shopping. If you want to get the reward, you don’t pay interest every month.
4. Provide emergency funds
Begin to set aside money every month that is intended as an emergency fund. When you have an emergency fund, you don’t need to rely on a credit card. This step is easier to make wise financial decisions and try to pay off bills when you know that there is an income set aside as an emergency fund.
5. Limit the number of credit cards
Indeed, various promos and benefits offered by credit cards are often tempting. However, it is also easier for you to get into a credit card trap if you have many cards. If you pursue discounts and promos, now there are many promos and discounts offered for users of debit cards and electronic wallets. You can use these canals. Just have one credit card to avoid various difficulties and losses if you have a lot of credit cards.
Read more: Don’t Use Your Credit Card for These Transactions!
