Tips on reducing credit card use

The following article highlights what you should know in order to reduce credit card use.

10:19 04 January 2014

Credit cards are a near-essential part of our existence nowadays. However, haphazard use of your credit card will land you in immense trouble if you are not careful.

While they have accumulated a bad reputation, you have to commend them for offering the essential convenience. If you want to book a flight online or have to make a purchase or basically where liquid cash is not applicable, you will have to have a credit card. However, if you are not careful this tool of convenience might turn out to be a nightmare.

The very fact that credit cards make it easy for one to borrow money makes them prone to misuse. You have heard stories about people who have gotten in way over their heads as far as credit cards are concerned. Mounting debt has crippled them in every sense of the word. The spiral can be controlled by utilising the following tips.

• Have an emergency nest egg

If you are going to use a credit card, ensure that you have a nest egg that you can access for those expenses that require liquid cash but have an option of a credit card.

• Be wary of the ‘time’

Paying your bills on time is a good practice. However, only a small percentage of credit card owners follow it religiously. Not only will you avoid a late fee, but you can stop the late payments from appearing on your monthly statement.

• Do not compare yourself with others

The pursuit of life beyond your means is futile and you should not use a credit card to be lavish as a result of peer pressure.

• Leave your credit card at home

If you have it on your purse, you are going to be impulsive and these purchases are often regrettable. They will land you in very big trouble when the credit card statement comes at the end of the month. Leave it at home and avoid the temptation - your credit card statement will thank you in the end of the month.