4 Common Credit Card Mistakes To Avoid-UAE-Dubai
Well, we all study maths in school and if you take up commerce in college, you will learn the nitty-gritty of accounting too. If you study further and do a post graduation in finance like MBA, you learn to analyse and interpret financial statements. But we never get to learn or we are never taught to manage our personal finances. I believe every college should introduce this subject because it is so very imperative. But we learn to manage our finances on our own. Saving and managing the money that we have earned doesn’t come easy. We try, experiment, burn our fingers and then we learn a lesson or two. But at times we find ourselves in a debt spiral which is hard to get out off.
It applies to credit cards also. Once we get our hands on your first credit card, we do not know what to do and what not to do. We go on swiping it as if there is no tomorrow. Credit card companies are not non-profit organizations. They need to make a profit to survive and our ignorance or irresponsible spending and managing our credit card works to their advantage.
Having said that, we can make the best use of our credit card/cards if we pay a little attention and take time to learn.
4 Common Credit Card Mistakes To Avoid:
1. Credit Card Interest:
You will be charged an interest on your outstanding balance on your credit card. You will have a balance only when you do not pay your credit card bill in full every month. Credit card companies give you this option of making a minimum payment on your outstanding balance, usually 4-5%. But this provision can put you in trouble as the outstanding balance keeps accumulating and you also have to pay an interest on that amount. Most of the time, we are ignorant of the percentage of interest charged on our credit card. Understand that you will not be charged any interest if you pay your credit card bill in full. Also understand that, if you take a cash advance, the rate of interest on this advance would be different, mostly higher than the normal rate. Try and read the blue print before you venture into carrying a balance or taking a cash advance.