6 Credit Card Mistakes to Avoid

What are the most common credit card mistakes to avoid? 

Credit cards can be fantastic tools on the path to improving your financial wellbeing. In fact, paying with a card can be a great way to build credit, earn rewards and build strong financial skills. The trick is to use cards in a way that help improve your finances, rather than adding financial strain. The good news is there are a variety of things you can do to help make your credit card habits solid. The key is to avoid credit card mistakes that can cost you big. 

Not treating credit like a loan

Credit cards, while convenient, are a line of credit. Like a loan, payment must be made or interest starts to accumulate. A great mindset to have when using your credit card is to make a purchase with the understanding that the money you spend now, you will have to pay back. 

Spending without a payback plan

It’s always a good idea to identify how you will pay back your credit card balance. While it’s ideal to pay off your balance each month, if you do fall behind and your balance starts accumulating interest, it’s essential to figure out how you will get that full balance paid off. 

Not paying off the right card first

If you do carry balances on multiple cards, it’s important to pay off the balance on the cards with the highest interest rates first. Prioritizing paying off those first will help you reduce your debt faster. You can even set up auto-pay, which can help making regular payments even easier. 

Making credit card payments late

One of the easiest ways to avoid late fees, is by setting up auto-pay and/or a reminder on your phone calendar to pay you credit card. Assuming you’ll remember to make your payment on the due date can be a dangerous game! Life gets busy and the fee for one missed or late payment can pricey! Using tools to make regular payments easy is a great way to set yourself up for success. 

Opening or closing accounts without a plan

Debt-to-income ratio is your personal debt to your gross income. Whenever you open or close a new credit card, it’s important to be aware of how that account will affect your current debt-to-income ratio. And if you open a new account, using it to some capacity, even if it’s just to make occasional purchases, can help your credit history as you make regular payments.

Not using credit card points

Don’t let your hard-earned points go to waste! You can leverage your credit card rewards points to pay for gifts, travel expenses and even charitable giving! In fact, points can be turned into rewards in the form of gift cards, flight miles, merchandise and can be used to cover holiday expenses, groceries and more!

Pile Up Points with Fox Communities Credit Union’s Visa Rewards Credit Card

Are you looking for ways to maximize your rewards and take advantage of great APR rates? Check out our many great Visa credit card options. We have a card for that is sure to meet your financial needs. Our Visa Rewards Credit Card has a generous rewards program, no annual fee, and no fees on cash advances! Contact our Fox team to learn more about this and our many great credit card and reward options today.

Membership eligibility requirements apply; to open a business credit card, business must be a Fox Communities Credit Union member.

Certain terms, conditions, and exclusions apply. In order for coverage to apply, you must use your covered Visa card to secure transactions.