You just think about taking that little piece of purple, yellow, red plastic no matter what color, but have you ever thought about the credit card limit and how much it influences your financial health? Well check out these tips, because today is the day to understand how to use the card to your advantage.
Credit card limit
You don’t even have to have a bank account to have your own credit card, but you can’t forget that along with the thrill of receiving it you also get a big responsibility. People tend to hire the card with the anticipation of dreams in mind, but without proper care that little friend can create a very big headache.
Look at your wallet. How many credit cards do you have? What is the limit each of them has? And the fees, which ones do not have free annuity? Yeah, you might not have thought of it before, but your wallet already weighs the responsibility of the choices when paying for purchases.
Still in doubt about it? So answer yourself, if you spent all your credit card limits today, would you be able to pay the debt without falling on the revolving interest?
How not to make mistakes in shopping
The bank may have given you more limits, but you should define how much you can spend without losing your financial health. To do this, follow some basic advice we give below:
Do the math
Add the limits of all your personal or family cards if the budget is shared. If the amount is higher than your income, start eliminating those you don’t need or talk to your bank about lowering the limits. This keeps you from falling into temptation and does not curl up by doing more than you can afford.
Have a daily limit
Ideally, your card limits should not exceed 30% of household income. So take the value of your salary, find out how much is 30% and divide the amount by the number of days in the month. This way you will know how much ideal maximum to spend. If your salary is $ 3000, for example, your card limit should not exceed $ 900 per month. This gives you $ 30 a day.
Limits high for emergencies only
Everyone can try an emergency and as the name implies, it is something unplanned that came up unexpectedly. This means that you may have a higher limit card, but how about taking it out of your wallet and leaving it at home? So you will only use it in cases of extreme need, unforeseen events and emergencies.
Write down the installments
Have in your budget all installments of an acquired debt. This prevents the value from being forgotten and you eventually reach the ideal limits.
I can’t pay the card bill
If you just figured out what the ideal amount of credit card spending was and you just got lost in your bills, it’s important to be aware: the interest on the revolving is so high! Therefore, it is time to resort to another type of credit with cheaper rates. Personal loan may be the best solution.