How to manage your credit card better?

Posted on Friday, March 8, 2019 - 13:51

Being able to be in control of your credit card instead of the other way around may be one of your resolutions you want to stick to this year. A better manage card can lead to potential savings and avoiding the risk of missing payments or slipping into the red. These are 5 handy tips to get you started.

Pay off other credit cards you own

If you own more than one credit card and owe money on them, you can take care of them by paying off the smallest amounts. According to ASIC, $45 billion is owed in credit card debt by Aussies. Furthermore, Aussies are charged interest on $31.7 billion of this debt. Working your way from the smallest debt to larger ones can make the process less daunting. You may be working on blasting debt on one credit card, but do not forget to meet the minimum repayment on your other cards.

Check the annual fee on your card

Loyalty comes at a cost, and this can soon be costly when it comes to your credit card. It is important to constantly assess if the annual fee on your credit card and the interest rate are worth paying. This means checking if you are still being offered the best value for your money when it comes to the cards features. If that is not the case, then it is time to find a credit card that does. ASIC predicts that cardholders that decide to switch their credit card to one that comes at a lower interest rate could have saved around $621 million in interest in 2016-17.

Automate your payments

It happens where you sometimes forget to pay off your credit card bill. Setting up an automated payment that pays of your credit card bill can help you avoid missing a payment which can leave you with a negative mark on your credit file. Getting into the habit of paying off your credit card on time can also show lenders your creditworthiness.

Choose a card that works with the type of spender you are

It is vital to choose a credit card that matches the way you spend. This can let you avoid a stress ball of missed payments and playing catch up. A rule of thumb is to find a card that will let you save, comes with benefits that you are most likely going to use, and work around your budget. If you find yourself stretching your budget to cover a credit card bill, then it is not the right card suitable for you.

Compare your way to a better rate

When opening a new credit card keep in mind to always compare your options. Speak to your card issuer to find what other options are available to you to see if you are getting the best deal possible. Also, remember to read the terms that come with the card, especially if you are planning to use it for the rewards program. In the end, this can help you avoid unnecessary fees.

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