You have or think to have a credit card and hold a captive place in your wallet for it, so these 10 Commandments are for you. The use of credit cards is popular among us, either because the relationship was initiated by our initiative or because, to benefit from discounts in their preferred establishments decided to join this means of payment.
We should not consider credit cards as a means of payment to avoid, but rather, as a means to use with intelligence. To use intelligently is to apply to know and follow the 10 Commandments of the Credit Card .
Say No to Annuities
In the days that run to adhere to a credit card with annuity is an act of pure ignorance of the market. Unless it is a contractual obligation accepted by the customer in response to the bank’s counterparts, there is no reason to pay the credit card annuity.
Never Provide Your Credit Card Information
Whether over the phone or over the internet. If you do not have guarantees that the transaction is secure do not provide them. Banks never ask for credit card information or even call for credit card information. When you receive this type of request do not hesitate to doubt it and have the initiative to call you to the bank or support service to clarify and answer all the questions. In the last resort go to the card vendor’s desk for clarification.
Remember that to transact at a distance with your credit card only the card number, name, expiration date and 3 numbers on the back of the card are required.
Memorize Your Secret Code
It is incredible how many people carry the secret credit card code, whether in the wallet or even in the wallet. Memorize the secret code and destroy the document where it appears. You can always change this code if you wish but avoid placing obvious numbers, such as door number or date of birth. We have tips for your credit card that will help you in the field of security, do not miss the opportunity to consult them.
Use Only When Needed
A credit card is not to be used in all your day-to-day operations, but in special purchases or purchases that you want to postpone the settlement of the same. We advise you to use only purchases over 25 euros if you wish to use this method of payment as a control of your personal finances, however, and it is prudent to use it only to anticipate needs, such as anticipating the purchase of an appliance.
Pay Attention to Benefit Programs and Other Benefits
Banks and credit card providers with the aim of encouraging credit card membership and use have excellent opportunities that will benefit their customers. One example is cashback programs or partner programs that allow you to save money while using your credit card.
Say No to Cash-Advance
Cash advance means the withdrawal movements carried out at ATMs or ATM machines. This type of movement starts to be more common, but weighs in the portfolios in a significant way, because as a general rule, banks charge between 2 and 5 euros per withdrawal plus a variable commission that is about 3 to 4% of the amount to raise. A small lift of 50 euros, costs between 3 to 7 euros of charges.
Do not Delay Payments
A forgetfulness or distraction in paying the credit card bill means paying a late payment commission that may be around 10 euros in most cases. Automating your payment may be a solution in these cases, but always keep in mind that you need to have funds available in your account to do so.
Know All Your Credit Card Charges
As a general rule, the only charge we are sensitive to when it comes to credit cards is annuities, and this sensitivity is wrong. If you take into account that the conditions of use of your credit card include charges for late payment, cash withdrawals at the ATM, use of the card abroad, second routes, second copies, among others, you will be amazed at the opportunities that the banks have to charge you another euro.
We must be alert and know everything about our credit card and keep these commissions in mind as they may exist on your card.
Avoid the Minimum Payment
Many credit cards allow for a minimum payment of the balance in debt which in many cases may be 5%. Opting for this mode means paying tens of euros in interest every month. In the article on the cost of the minimum payment in the credit card we demonstrate how completely this modality is inadvisable.
So avoid paying the minimum payment at all costs and if you do not know your payment method consult your bank to find out.
Pay the Credit Card Debt at 100%
It is definitely the best recommendation for your credit card, since having a non-annuity card and choosing to always pay 100% of the credit card is guaranteeing that you will not have any charges with your credit card.
These are 10 commandments for proper management of your credit card. We believe that credit cards can be good personal finance management tools. However, they should be used with caution because they may lead to situations of excessive indebtedness that are very difficult to solve. In fact, many of our financial consultations are caused by excessive debt by credit cards. Although difficult to correct, it is always possible to reduce financial benefits. For example, through consolidated credit!