Tips for Shopping with Credit Cards

A credit card can not only be a source of additional income but also create a huge hole in your budget. What tips should you heed so that you don't get a bill with an extra zero after shopping?

Don't pay with a credit card for things you can't get

Make it a rule to pay with a credit card only for things you would have bought on your salary. Moreover, in case of an emergency, you can quickly repay your debt from your savings. If you get 25 thousand a month and have saved 30 thousand more, it is a bad idea to buy a smartphone for 100 thousand. First of all, you probably won't make it through the grace period. Even if the bank is loyal and offers you to use the money without overpayments, for example, 100 days, you will get only three salaries during this time. Together with your savings, that would be 105,000, and you still have to eat something. Secondly, if you are fired, you won't be able to pay the bank for sure. And the constant increase in interest payments will make the situation very desperate.

Don't pay with a credit card for everyday things

If you do not have enough money for food, rent, and clothes, do not rush to get a credit card. A card is just an illusion that you have more money. In fact, it only allows you to transfer some of your earnings from next month to this month. Accordingly, your future income is automatically reduced by the amount you have to repay the loan. For example, if you are regularly playing at the online casino with credit card deposits, that’s okay to pay with a credit card, but if you want to buy a chocolate bar, it will be better to pay with your cash. When you don't have enough money for everyday things, it is worth working on your financial management or trying to earn more. Debt in your case is a quick and easy way to make things worse.

Use your credit card to save

Some offers from shops, airlines, travel agencies are stunning with their generosity. But to get a grand discount, you have to pay now. In this case, the credit card will come to the rescue. For example, you find that your dream bike, which usually costs $5,000, is only sold for $2,000 today. You have money for it, but it's on deposit. And you don't want to lose interest because of an early withdrawal. At the same time, you can accumulate the right amount of money without losing it in one month. But it's only today. As a result, the most advantageous option is to pay for the bike with a credit card and return the debt to the bank in a grace period. So you save 3 thousand dollars and get a dream transport.

Consider the cashback and discounts

It is more profitable to make purchases by credit cards in those places, for which your bank provides interesting offers and discounts.

Take it as a safety net when you travel

During the trip, a credit card may help rent a car. So it’s useful credit cards are useful not for everyday payments, but in a situation when you need quick and instant payments. It's also very helpful in case of contingencies. But despite a lot of advice on the Internet, it is important to remember that the bank is not a good fairy who decided to sprinkle you with money. It's a commercial institution that's trying to make money on you. Remember that every time you take a credit card out of your pocket. You're the one who spends other people's money now, and you have to give yours back. Another negative consequence of improper use of the card is damaged credit history. You should not think that only information about “real” loans falls into the database. Even a small debt, returned at the wrong time, can get between you and the mortgage.