Most people believe that it is impossible to use your credit cards for saving money as they’ve already been touted as the financial tool for spending money. Credit cards seem to be the most convenient financial tool that helps us purchase things without cash but when we start misusing our cards, we start incurring high interest debt which is tough to get rid of. Did you know that credit cards, if used properly and wisely can even help us save our dollars? Well, if this doesn’t seem to be true, you should believe your eyes and come to terms with the fact that it is possible to use your cards to save your dollars. If you’re not aware of the ways in which you can save money with your cards and avoid falling in credit card debt, here are some points that you may take into account.
Combine your debts with utmost care: Most debtors who owe a huge balance on their credit cards use one of the most common ways of merging their cards, through a balance transfer method. The new low rate card offers 0% or nominal charges for a fixed period of time, which is known as the introductory period. If you can cleverly transfer the entire balance within the introductory period, you can gain huge benefits of low interest rates, low monthly payments and you can also save money. This way you can use your credit cards in order to save your dollars and also repay debt.
Utilize reward cards: Most people are fans of reward credit cards and they tend to take such cards even when they’re not aware of the details. You should be aware of the fact that the reward cards carry higher interest rates than the normal credit cards and hence you should use such cards only when you’re sure about repaying the entire balance in full. Only when you can commit to a schedule, you should opt for reward cards.
Pay more than the minimum on your cards: You will find the credit card companies or the banks advise you about paying only the minimum amount but remember that this is simply their strategy to make money out of the accumulated interest rates. The longer you take to repay the principal balance, the interest rates will keep on accruing and hence this will affect the debt amount that you owe. Always save on the unnecessary expenses so that you’re able to pay down your cards on time.
Learn to say “No” to multiple card offers: If you’re someone who is presently getting a number of credit card offers, you should learn to say “No” to them. If you’re into the habit of accepting most of the card offers, you should change this immediately. The more cards you own, the more will be the debt amount that you will accrue and the tougher it will be for you to get out of debt. Having more cards will encourage you to spend more and although this is a positive sign for the companies, it is something totally detrimental for your financial health.
Negotiate for a lower rate: If you’ve got a good credit history, you should negotiate a lower rate on your cards so that you can easily make payments without defaulting. Convince them that you’re a timely borrower and that you will pay off the bills on time so that they can agree to lower the rate on your cards and help you live within your means.
Thus, if you haven’t been aware of the different ways in which you can save your dollars on your credit cards, you can take into account the above mentioned points. Use your cards wisely and help yourself save money and secure a better future.