Save Money on Credit Cards

Ever thought to yourself ‘I need a credit card in case of emergency!’ only to find yourself purchasing clothes, videos and countless groceries on your card? If the answer is yes you would be part of the probable demographic within Australia that owes on average $5,500 on credit.

Credit Cards are actually useful items to possess if utilised properly. They can be used for everyday purchases but should always be paid off in full within the given 55 interest free days (if you have them). Having a Credit Card can allow for you to even out your cash expenses between each pay cheque and allow for a suitable cash flow process to occur, but should always adhere to your budget and not be in excess.

What should you consider when applying for a Credit Card?

• Do you want interest free days?
• Do you not want interest free days?
• Did you want a point scheme?
• Would you prefer less interest or more benefits?
• How much do you need to borrow? If more then $20,000 – suggest looking at personal loans instead.

Potential Credit Card Traps

• annual account fees
• fees to use rewards programs
• fees for late payments
• payment dishonour fees; and
• fees for exceeding your credit limit.

Whats the benefit of Credit Card Reward Schemes?

One must remember the following points when considering credit card reward schemes;

• will you use your card enough to qualify for the rewards?
• will you have to make extra purchases you don’t otherwise need to earn the rewards?
• will the program discourage you from shopping around for the best priced goods and services?
• will you have to redeem rewards points within a certain time?

Balance Transfers and Honeymoon Periods

If an introductory or ‘honeymoon interest rate’ is offered, typically, for six months – make sure you know what rate the card goes up to at the end of the honeymoon period. Check fees and charges. A card that imposes higher fees might wipe out your ‘honeymoon savings’ before long. The same thing can apply to offers of ‘no fees for twelve months’.

Secondary Credit Cards

If you allow anyone else to use your account through a secondary card, you remain liable for all amounts owing, including any losses from a secondary card-holder’s negligence.

Beware that some institutions will not actually cancel a secondary card until it is returned to them. Check the Conditions of Use. Returning a card may not be possible if your personal relationship has broken down.

Your institution may still hold you liable for any transactions by the secondary cardholder that the institution cannot stop through electronic or telephone approval.

Pay off your Credit Card as fast as you can!

That is my last peice of advice. Use credit cards in a smart way, pay them off each month, don’t miss a payment, always make more then the minimum payment. This here concludes my Saving Money on Credit Cards spiel!!

Related Posts

• American Express Credit Cards

  American Express credit cards, more popularly known as AMEX, are among the most used credit cards worldwide. Even those who already have another card such as a MasterCard or Visa often still want to obtain an American Express credit card. AMEX, along with MasterCard and Visa comprise the most popular credit cards. However, there are [...]

• Student Credit Cards

  Creating good credit and getting student credit cards is new territory for college students. Your future is starting now and you probably haven’t given much thought to building your credit. Getting off on the right foot is crucial for your financial future. Making the wrong moves can haunt you for years and you should be [...]

• The Credit Card Handbook

  Here is the credit card handbook. These are the most important yet commonly overlooked aspects of Credit Cards. I suggest you think about them everytime you pickup a credit card to purchase something.

  Control your Credit Cards, don’t let them control you!

  Cash advances – beware!
  Even if you have an ‘interest-free days’ card, you pay interest [...]

• Store Credit Cards with Australian Retailers

  Do you owe money on a store credit card with a major Australian retailer? Most Australian’s take advantage of the 24months interest free option when buying consumer electronics and furniture from makers such as Harvey Norman and David Jones – leaving them with nothing to pay now, but a large debt lieing in the grass [...]

• Are Credit Cards Still Competitive?

  For practically the last decade we’ve seen the credit card change from something only the rich use to something practically every person in Australia owns. I think the average number of credit cards per person is 2 or 3 and I know it’s commonplace for people to have 5 credit cards in their wallet or [...]