5 Signs That You Suck at Using Credit Cards

Who doesn’t have a credit card nowadays? They are convenient, great for building credit, and you can only purchase some items with a credit card to help you pay for them (if you’re careful).

But, just because you have a credit card, it doesn’t mean you are using it right. In fact, you might suck at using credit cards. (It happens!) Here are several signs that you are using your credit card in all the wrong ways:

You Use It for Everything You Buy

If you swipe your credit card to buy eggs at the convenience store, then at the gas station, and then again online for a new pair of shoes, you are certainly overspending using your credit card. If you reach your credit limit, you will have to spend a fortune paying off the interest. The wise way to use a credit card is to use it only if you need it for certain expenses. You should use your income to pay for everyday needs.

You Use It to Pay for Other Credit Cards

If the primary reason you have a valid credit card now is to pay off debt incurred by previous credit cards, then you are in serious trouble. You cannot pay down credit card debt with other high-interest incurring credit cards. If you are overwhelmed with debt, cancel the credit cards and make a budget plan to reduce unnecessary spending, and use that money to get out of debt.

You Only Have One and It’s a Store Card, or You Have Too Many

If your “credit card” is a store card, it’s not going to be useful in any way to build up credit history. If you are a recent graduate or someone who needs to improve your credit score, you will need a legitimate credit card provided by a banking institution, not store cards.

On the other hand, if you have way too many credit cards that you don’t even know how many are in your wallet, you could be ruining your credit history. Too many credit cards mean you are mostly likely sinking into a deep debt. Therefore, only have one or two credit cards at maximum, and pay their monthly bills on time.

You Think You Need It

If you cannot afford everyday expenses without your credit card, you are probably crippled by debts. When you use your credit card, you are borrowing money. A financially healthy individual does not need to borrow money to buy bread and medicine. Therefore, stop depending on a credit card and sort out your personal finances immediately.

You Can Only Afford the Minimum Monthly Payment

If you have a credit card or two, but can only afford to pay back the minimum monthly requirement, then you are living beyond your means. Credit card debt does not reduce overall if you only pay the minimum requirement. Also, paying the minimum means you are acquiring debt with the interest due. Therefore, if you are currently in this situation, it’s best to start being thrifty.

It’s easy for people to get overwhelmed by credit card debt, especially if they suck at using credit cards. Credit cards are not a magic key to a lifestyle beyond your means. They are lenders, and you should use the money you borrow very wisely.

Do you suck at using credit cards?

Comments

  1. Danielle says

    I feel like the first one needs a caveat. I use my credit cards for everything I buy (barring places that don’t take credit cards), in order to accumulate the rewards. There is never a balance left on the card, so there are no interest charges. I also don’t pay any annual payments for my cards (because that would negate the rewards earned). This may not be how most people use their credit cards, but I feel like it ought to be mentioned… If you use your credit card like a debit card (never spending more than you can afford) you can reap the benefits of having a credit card.

    I guess, all this is to say that credit cards are not ALL bad, if used correctly. Having a good budgeting foundation is key to proper usage.

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