This year is the perfect year to get on track with your credit card spending. If you have had trouble in the past, now is the time to really kick things in gear. The truth is that credit cards have been designed to make people spend. Just take rewards for example: credit card companies encourage people to spend money on certain things so that they can receive air miles. However, what if you don’t need these things? What if you don’t have the money? When it comes down to it, using credit cards requires discipline and willpower. Here are five helpful tips for managing your credit card in 2015.
- Close out credit cards that you don’t use. Now that it is a new year, you may want to close out any credit cards you don’t use. These credit cards are only going to cause you grief – mainly because you may still be paying annual fees. Closing these cards will be important if you want to keep your credit healthy.
- Lower your spending limit if you are spending too much money. If you visit Credit Sesame and check your credit, you may want to increase your spending limit if you have a high score. However, if you are having trouble managing your credit cards, you may actually want to lower the minimum. The last thing you want is to think you have more money than you do. When you have a higher minimum, you will wind up spending money that you don’t have.
- Don’t charge your credit card purely for the sake of cashing in on rewards. One way to not get in trouble with your credit card is to not charge your card for the sake of reaping rewards. Yes, you may accrue air miles, but if you are spending just to spend, you are basically buying those air miles. The same goes for other rewards, like cash back bonuses and gas points. If you spend reasonably, you will feel much better about cashing in on your rewards.
- Always budget and don’t spend more than you have. On top of everything, you also want to budget accordingly. If you make a certain amount every month, you want to budget how much you can spend on your credit card. You may find out that you have been spending too much money and need to cut down. Cutting down on these expenses will help you stay financially afloat. Moreover, it will keep you further and further away from the red.
Never let your balance cross over into the next month. Of course, you also want to pay off your balance at the end of the month. If you don’t, you could be faced with high interest rates that will make it more and more difficult to pay off your credit card bills. When it comes down to it, you may want to set up an automatic payment or transfer system so that you never have to worry about paying your bill.