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Seven tips to keep your credit card in check

Manage needs vs wants

It may sound obvious, but it’s no less important to mention. While a credit card can be useful, when it’s brought out for things that aren’t strictly necessary, it can be damaging to your finances – especially if more and more little ‘want’ purchases accumulate on it.

Quick tip: Before swiping your credit card, take a step back and evaluate not just what is being purchased, but why.

Pay it down in full

Is debt lingering in your account, and accruing more and more interest over time? While credit cards are all about convenience, they can also make it easy to lose track of your spending – and that’s when a bit of discipline can go a long way.

Quick tip: If you can, aim to pay the debt off in one lump sum – and if not all debts, then at least aim for the high-interest debts first and go from there.

Check the fees

Most credit card providers will have little fees for different aspects of your account. For example, there will typically be an annual account fee – but there can also be a fee for additional cards, going over the limit, and using it for foreign currency.

Quick tip: It’s a good idea to take a moment to see what your fees are and keep them in mind. By knowing what to expect, you will be more confident and in control of your financial life.

Align your payment date with your salary

Sometimes, an easy way to keep your credit card debt under control (and avoid spending more than you earn) is to get the timing of your payments right.

Quick tip: Are you paid weekly, fortnightly or monthly? Aligning your payday with the day you make repayments may help you better see the amount of money shifting accounts.

Reduce your limit to the minimum

Hitting the limit on your credit card can be an excellent incentive to step back and consider your spending…

Quick tip: Rather than leaving the limit on the default or higher, encouraging you to splash out, try bringing that limit down as low as it will go. That way, you might be less tempted to splurge.

Consider a debit card instead

If you’re all squared up on your debts, maybe now’s the time to think about ditching the credit card altogether.

Quick tip: If you like the convenience of making direct purchases from your bank account, but don’t like accumulating extra fees and debt, would a debit card be a better option?

Whichever tips you decide to follow, the most important thing is to be mindful of how you’re using your credit card and the impact on your finances. A little planning and a healthy dose of transparency can help you save your hard-earned dollars.

Disclaimer: Please note that the content provided in this article is intended as an overview and as general information only. While care is taken to ensure accuracy and reliability, the information provided is subject to continuous change and may not reflect current development or address your situation. Before making any decisions based on the information provided in this article, please use your discretion and seek advice from a financial adviser.