Americans alone have trillions of dollars in credit card debt. When calculated, this amount translates to over $6000 per household. Having credit card that comes with its own disadvantages and financial risks. You have to pay thousands in the form of interest, which can lead to delayed payments and can affect your credit score. You can assess a seasoned tradelines source to improve your score.
Below mentioned are some of the best ways you can a adopt to avoid getting trapped in credit card debt.
Make Some Emergency Savings Fund
To stay safe in the case of a financial emergency, you should make an emergency savings fund. This way, you can keep yourself safe from a big credit card that whenever the need arises.
Usually, experts recommend having at least good enough savings to cover your living expenses for up to six months in the case of a financial emergency. While doing this is difficult, you can start with a small step and make your way ahead. So, instead of relying on debt, you should build an emergency savings fund.
Only Buy What You Can Afford
One of the disadvantages of having a credit card is that it can tempt you to buy expensive items which you cannot otherwise afford to pay for. While many people rely on their future income to buy an expensive thing, there is no guarantee of steady income in the future.
So, you should start building a habit of saving up for what you want to buy, and buying only the things with you can afford to pay for in cash.
Avoid Trying to Outsmart The Card System
Many people transfer their high interest balance to a lower interest balance account in order to save themselves some money in repayments, and this is a smart move as well. However, many people try to transfer their balance from one account to the other in order to avoid re-paying their debt on time. This can lead to abnormally higher fees.