Having a credit card is a great responsibility that most people take advantage of. Without properly managing your credit card and taking full responsibility of the effects of having debt can greatly affect your finances.
Credit cards are very useful and totally help in keeping your spending efficient. Managing your transactions through your credit card is a good way to keep track of what you are paying. But to some who disregard the value of a credit card, they often end up in using the credit card without properly monitoring the spending. This is when it starts to become a problem. Debt starts to accumulate and managing it becomes a struggle. Rolling over credit continues and before the holder notices it, he’s already deep under debt.
Here are a few questions you can answer to guide yourself when is it time to get a credit card.
- Am I liquid enough to pay the full credit limit of the card?
When you decide to get a credit card, you must have enough cash that can pay the full credit limit of your card. Otherwise, request the credit limit of your card to be lessened to an amount you can pay in full.
- Am I an impulsive buyer?
Credit cards have been known to encourage holders to spend beyond their means. Knowing if you are a person who buys on impulse or knows how to check if the purchase is necessary will greatly help you in managing your debt at a minimum. Remember, charging purchases with your credit card means you are using someone else’s money which you will eventually pay with interest, in this case, the bank’s money.
- Do I have a consistent source of income?
When you plan to own a credit card, it is very important that you have a source of income which you can pull money from to pay your purchases. Rolling over your credit is highly discouraged and it is advised that you pay all your purchases from the card in full when the statement arrives. This helps you avoid paying for unnecessary interest rates.
Having these questions in mind will help you manage your credit card better when you do decide to get one.