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Common Credit Card Mistakes

Credit cards are both God’s gift and curse to man – it all depends on how you handle them.  A lot of times, however, credit cards become a means of overextending our finances.  This is only because we commit certain mistakes that should be avoided as much as possible.  Here are the most common practices regarding credit cards that we should avoid.

Revolving balances
The mentality is to just pay the minimum required and to make larger payments later on if extra cash comes along.  Even the credit card statement encourages making at least the minimum charge.  This is only a fraction of what you really owe and if you keep doing this and leaving balances on your statement, you will be feeling the heavy weight of finance charges in a short while.  That is why some people get caught in the cycle of credit card debt – the interest on remaining balances kills them.

Late payments
Late payments occur when you do not pay (at least) the minimum charge on or before the due date.  Now I can’t really come up with an excuse for this.  As mentioned above, the minimum charge is a very small amount.  If you really have no  money to pay off the whole balance then make sure you pay something – do not miss a payment as you would get charged extra once again.

These two mistakes are compounded even more if you purchase items on interest free installment plans.  The benefit that you get from interest free promos is negated by the hefty interest and finance charges that are applied.  So if I were you, I’d watch my credit card use closely and pay off balances as soon as I could.