Holiday spending can take a toll on anybody’s credit cards. Credit card Spending can also get out of hand if you are using multiple credit cards. In this article, we are going to discuss what you should keep in mind while doing your Credit Card Shopping.
Credit Card Limit
You need to keep your Credit Card Spending to less than half your credit card limit. Why? Because spending “maxing” your credit card limit is a bad indication to potential lenders. It shows that you have a higher appetite for credit and you are unable to clear your debts. One way to temporarily deal with that problem is to apply for a credit card limit increase then repay your credit card debt. That could help you get credit when you need it, such as when applying for your mortgage.
Number of Credit Cards
How many credit cards do you have? You should keep the number of credit cards you have to about four or three. Having only one credit card that you have maxed out is bad for your credit card rating. It gets interpreted an indication of being rejected by other credit providers. Therefore, your best option is to do a balance transfer and spread it over three or four cards. Of course, you have to keep all balance transfer fees and repayment rates of each card in mind.
Pay All Your Debt on Time
One of the biggest mistakes most people make is to delay paying all their credit card debts on time. That is because many credit providers will charge you interest on the initial amount you owe rather than the balance you owe. That means that the longer you wait to clear the holiday spending, the more you will have to pay. Another option for you to avoid paying interest on your credit card shopping is to pay before you get your credit card bill. That allows you to use your credit card without being interest on your debts.
We hope this tips will help you enjoy your credit card shopping without your debt becoming unmanageable.