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Tips to Avoid Credit Card Debt

Tips to Avoid Credit Card Debt

We all have our reasons for debt, but as far as credit card debt is concerned, one must be careful. Late last year, our collective national credit card debt was in excess of $4 trillion. This means the average household has a debt of over $6,000. So, to make things easier, we have provided a few tips to avoid credit card debt.

Keep Emergency Savings
When you do not have emergency savings, you might be forced to use your credit card to cater to the unexpected bills, a home repair, or any other contingent expense. Of course, it would take some time to save a huge chunk of money, but you have to start somewhere. You can start by saving a smaller amount every month so that it can be used anytime a huge expense pops up. It can be a huge plus to use your emergency savings, instead of relying on your credit card to seek rescue. 

Don’t Swipe for Trivial Purchases
Many people get tempted to buy a couple of things that they want and not need. And this is simply because they can pay for it via their credit card. Yes, you might be able to pay for it over time, but creating debt for your trivial wants is not the best thing to do. If you need something, save up for it and then buy it using that money kept aside instead of swiping your credit card. 

Skip Those Balance Transfers
It makes sense to transfer some balance from a credit card with a high rate of interest to the card with a lower rate to clear off your balance. However, if you are only transferring the balance to trick the debt system, it can backfire at any given time. For instance, some people try to do this to avoid paying their debts on the due date. When you continually transfer the balances without clearing out a major chunk of the dues, it can pile on and bring in massive cost. 

Clear Your Dues on Time
A great tip to avoid credit card debt is to always make the payment on time. If you miss your payment in a particular month, your dues for the next month would be higher, which might be difficult for you to clear off. In addition to the double dues, you’ll have to bear a piling late fee. So, only spend as much as you can afford so that you can clear your debt timely. 

When you have a lot of debt in your name, it puts you at a huge risk. It can lead to financial troubles, delay your long-term goals, and bring in a massive cost in the form of interest. Moreover, if you ever skip on your payments, your credit score might deteriorate, it will make it difficult for you to grab a loan in the future. Thus, it is important to avoid credit card debt. So, follow these tips and keep debt at bay.

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