Often Overlooked Factors Leading To Credit Card Lapses

One of the common misconceptions of owning a credit card is the possibility of getting buried in debt. While having this fear is valid and often comes close to reality, people fail to acknowledge the real problem behind it. Claiming that the trouble stems from owning a credit card is similar to saying that automobiles are the reason for road accidents. Placing the blame on the tool or medium is the usual retort, instead of addressing the real problem, which is learning how to properly use it.

While some have the luxury of getting salvaged from debt either by their parents, relatives, or friends, a lot would find it difficult to seek help especially when it comes to finance-related woes. It leaves quite a mark when we have to ask for assistance regarding something that we’re oftentimes directly responsible for.

Listed below are some of the usual mistakes that most people take for granted, amounting to immense, financially crippling debt.

  1. Failing To Check Your Monthly Statement – Given your busy schedule, it would take a certain amount of discipline just to make yourself check your statement–once in a span of 30 days. This is an important practice so you can verify if the purchases listed are indeed yours. Failing to check if an unauthorized item was made would make it harder for you to refute the credit card transaction, especially since you weren’t able to report it right away.
  2. Mind Your Expenses – The primary convenience of having a credit card is not using cash for your payments. However convenient it may be, it also gives a false notion that you have the liberty to swipe away since you don’t directly feel you’re actually spending money. This can often lead to impulse buying, eventually neglecting the item and amount you’ve spent on, whereas by right it should be the other way around, requiring a more careful eye in monitoring your expenses.
  3. Balance Transfer End Dates – One feature that banks emphasize on is the ability to transfer your outstanding balance to a new credit card with a lower interest rate, usually from a competitor bank. However, most people overlook the fact that this low interest rate only applies for a short period of time. This is usually stated on the fine print where it can easily be disregarded. Always keep in mind what’s written in there and make sure to follow these regulations to make the most of the offer.
  4. Inattention To Automatic Payment Details – Another convenient aspect is the ability to set automatic payments on your monthly payables using your credit card. This can be very handy to manage on-time payments without worrying about their due dates. Just remember to be attentive as to changes in amounts, payment periods, and other arrangements that can inadvertently lead to accumulation of unsettled bills.
  5. Matching Your Credit Report – Your personal credit report is the main basis for identification about your financial status. This should always reflect your current standing, furnished with utmost accuracy as possible. Make sure it doesn’t contain outdated data on previous debts as this would appear negatively on your credit score. You wouldn’t want to look like an irresponsible creditor when dealing with financial institutions.

The conveniences of technology are everywhere and if used effectively can provide significant assistance with our everyday living. However, with regards to money matters, the capability to spend should always be acknowledged as a privilege, and must be handled carefully and responsibly. Having the self-discipline to monitor and control your expenses while living within your means should always be your primary resolve in order to steer clear from the pitfalls of debt.

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