Who could imagine that a piece of plastic would play such an important role in our lives? This payment system came into being in 1950 and was designed by businessman Frankie McDaniels to institutionalize one of society’s most common practices, the famous “spun”, believe it?
While invention has made our lives easier by allowing us to buy our objects of desire and make dreams come true, credit cards can become a headache if we don’t know how to use them. After all, a small slip can disrupt all control of the accounts. The Brazilian who says it!
The Credit Protection Service (SPC) surveyed people credit card spending habits in 2018 and found that one in five users uses the tool as a supplement to their salary. Which, of course, makes the vast majority in trouble with paying the statement at the end of the month.
How to use credit card with planning
We have talked a few times here on the blog about how important it is to plan and forecast the main expenses of the month to have a healthy financial life. With credit card this practice is no different.
Be aware and define the expenses you will use on this type of card. It is important to determine when each type of tool comes in. For example, prioritize paying everyday and superfluous expenses with cash or debt, as seeing money out of your pocket will give you more thought about the need to buy.
It is important to have limits
As we said above, the Brazilian has the habit of using the credit card as a supplement to the salary. That way, we already know that the month’s account doesn’t close!
So set a limit for your card that matches your income. Ideally, it should be at most 50% of your net revenue, meaning what you earn after all discounts.
Track your expenses
The ease of passing the credit card, even without having money in the account, can make us spend wildly. It is very important that you keep track of all your spending, either by logging into financial tools or checking out at the end of the month through your institution’s digital service.
Pay all your invoice
Paying only the minimum of the bill may be more convenient when paying off the statement, but it is possible that the practice will make your debt priceless in the future! The best option on how to use credit card is to pay the full amount. Since this is one of the most expensive forms of financing. Remember that next month you will pay the remaining amount of this invoice, plus interest and new card charges.
Finally, it is important to understand all aspects of your card, from fees, coverage, payment dates and facilities. What’s more, you have to take responsibility at the time you spend, understand what the best forms of payment are, in your reality, and make sure you’re doing the right thing with your card.