You can make your credit card work better for you, and in the process, save a great deal more money on it than what you might think. In fact, here are just a few ways to save money with your credit card, and use your credit card wisely to get the most out of your finances as you move forward in life.
Pay On Time
By paying your credit card off on time (or early), you get to avoid extra interest payments, late fees, and more, and you keep your interest rates down as you save money and keep balances low.
Track Your Spending Your credit card has limits; do you know what they are? By tracking your spending, you can come up with exactly what you need to do to pay your credit card off, as well as how to advantageously set up your spending habits to buy what you want, without needing to pay back too much that you can’t handle.
Pay More Than The Minimum
Every month, when you pay more than the minimum required on your credit card statement, you keep interest rates down and payments low. Not to mention, you greatly improve your credit score, which can in turn help you save tons of money on major purchases from creditors like banks.
Direct Debit Your Balances on Payday
To keep your credit scores high and your interest rates on things like car purchases and home mortgages low, set up a direct debit from your account to pay off credit card balances each and every pay day. Even if it is just a portion of the balance owed, it can work wonders for you when it comes time to pay off balances and strengthen your credit score.
Beware The Store Cards
Store credit cards, like those from department stores, can be great for a while, but for many people, they attract high and hidden fees. Beware of these cards, and fully understand the fees that you will pay before you sign up for one.
Calculate Your Spending You can use online credit card calculators to calculate what you should be spending each month, based on your average income and assets, as well as how long it will take to pay it all back in time. Doing so will allow you to keep your spending down and your rates lower still.
Don’t Take A Cash Advance
It may seem tempting in the short run, but the best way to save money with your credit card is to avoid things like cash advances. They can drag down your credit score as you struggle to pay them back, and can come with extremely high interest rates, that make it difficult to get through the entire period without incurring penalties, and other hidden fees.
In all, even though credit cards took a beating during the recession and generally unadvisable spending by many people over the last few years, it is possible to save money with your credit card if you do it wisely, and are proactive about spending. Good luck!