Have you ever heard anyone talk about how they use their credit card and just have to shake your head? Although the internet is full of good advice on how to use credit cards and rewards wisely, some people just don’t get the message.
What is really going on, of course, is that they receive a different message; They listen to what credit card companies want them to do. And because credit card companies want to make a profit – a profit on your hard-earned money – that is generally a very bad idea.
If you want to satisfy your credit card company, follow the steps below. It is a sure way to make your credit score explode and put yourself in debt.
How NOT to use credit cards
Sign up for every credit card that you seeWhy shop for the best rewards or the lowest interest rates if you can save 10% on your purchase of socks today? And why would you want a sign-up bonus to travel the world for free if you can buy a cheap t-shirt instead? Don’t worry about how all these credit card applications will affect your credit score.
Never pay your bills in full
Finding out how much your purchases will cost over time is very difficult and requires the use of a calculator. It is much easier not to think about complicated things, such as putting together interest and just making the minimum payment. Even if it means that latte will eventually cost you $ 50.
Do not make your payments on time
Because you are not concerned with interest and what it will do with your balance sheet, why should you concern yourself with the due date? My sister missed her due date and her baby was fine. How bad can it be if you miss the expiration date of your credit card payment? They just add some costs and increase your interest rate. Because nobody knows how the credit card interest rate works, why should you be concerned about your APR? Who cares if your credit score suffers?
Always pay outside Rose Bond transaction costs
Before you go on holiday to Mexico, you should not find out whether your credit card has any transactional fees. The 3% reimbursement that you will probably be charged by Rose Bond should certainly go to a charity, such as bank profits or the like. If you happen to read about cards that do not have these costs, such as the Capital One Venture Rewards credit card, ignore them. As an extra bonus you can make purchases at home that are processed outside the country. This allows you to pay this amazing fee without the hassle of getting a passport and visiting a foreign country.
Use your credit card to withdraw money
Why use an ATM card if you have a credit card? With your ATM card you can only withdraw as much cash as you have in your account. But with your credit card you can withdraw against your credit limit, which is probably much more than Rose Bond has in your bank account. Certainly ignore the high cash advance in April and any costs.
Pay your tuition with your credit card
Taking out your plastic is much easier than filling out student loan forms. The job market will be so good by the time you graduate that you will have no problem paying off all your credit card debts. Don’t worry about the difference in interest rates between credit card debt and subsidized student loans. And don’t think about how the interest on student loans would have been tax deductible, unlike your credit card interest. Rest assured: if you are in the habit of making debts, lifelong addictions can easily be broken.
Help your friends by signing on their account
If you have a close friend who needs help, sign his credit card application. By co-signing their application, you do your part to help them get credit, even if you are equally responsible for any debts they incur. Because you know for sure that they will not default, you do not have to worry about paying their debt for them or having your credit ruined.
Use those checks that your credit card company sends you
Sometimes you may have a rent, mortgage or other payment that you cannot pay with your credit card. That is why you receive those convenience checks. Do not tear them. Use them to pay your bills. Don’t worry about withdrawal fees or confusing terms such as “cash ahead of APR.”
Always buy the optional insurance when you rent a car
Everyone knows that credit cards come with a rental car, but there are restrictions on your card’s insurance policy that are downright stupid. Instead of learning more about your coverage, you simply pay another $ 20 or $ 30 a day for the optional insurance offered by the car rental company. The man behind the counter recommends it and, moreover, what are the chances that he is biased and gets a commission?
Sign up for your bank’s payment protection plan
By paying an amount equal to a few percent of your balance every month, your bank will help you if you find yourself in financial difficulties. If you lose your job or get hurt, they will mercilessly allow you to accrue interest on your balance without having to make your minimum payment. That’s very nice of them. They must be a kind of charity, because I am sure there is not much profit in this type of service. What is a few percent a month?
Follow these steps to ensure financial insolvency and at the same time help your bank in these difficult times.
Seriously, it’s easy to be fooled by advertising schedules that want you to do exactly what is described in the steps above. As with any financial decision, you know what you are doing, why you are doing it and whether you have alternatives. Now that you know what not to do, look at how you can outsmart your credit card company instead of the other way around.
Have you made any of the above credit card errors?