Building credit is a very important habit to build in order prove your financial responsibility to certain lenders, and one of the major tasks that you will have to undergo is being responsible with your credit card bills. Being responsible with these bills can do wonders for your credit score, but mismanagement of your credit card can have long-term detrimental effects. Here is how to manage your credit card bills going forward.
Pay More Than Just The Minimum
One of the greatest temptations in paying off a credit card bill is to just settle for making the minimum monthly payment and moving on to save yourself more money going forward. However, making the minimum payment also means that you are extending the shelf life of your bill. Making the minimum payment may be just enough to ensure that the interest doesn’t compound the principal, but you will not be making much headway.
If you want to see your bill go down quickly, what you will want to do is ensure that you pay more than the minimum. Ideally, you will want to pay as much as you can monthly so that you can get past the interest implications and start attacking the principal.
You could consult Punch Associates for more information on the implications of credit card debt and more effective ways to manage it.
Consider Setting Up Autopay
This will be contingent on being responsible with your spending and ensuring that you have a steady income, but if you have enough money in your bank account, you can take advantage of the autopay feature that most credit card companies offer.
This can be convenient for you, especially if you have many bills that you have to pay and could potentially be liable to forget to make a payment. It happens to everyone, but missing a credit card payment can have a drastic effect on one’s credit score and will not reflect well on the report.
It is better to have the funds taken out automatically than to wait until the last minute to do so only to discover you can’t.
Do Not Spend More Than a Third Of Your Limit
One general rule of thumb of managing your credit card bills is that you should spend more than a third of your credit limit. The amount of money a lender allows you to borrow is the maximum amount that you are permitted to use in a fixed time period, but paying that money back will be complicated the higher and longer you carry a balance.
In order to save yourself the future hassle, you should be encouraged to NOT spend more than a third of your total credit limit so that you could pay it off more effectively. Try to refrain from making major purchases that can eat into your credit limit as well.
Check Your Credit Card Statements Regularly
Nobody is perfect, and sometimes, errors can occur, especially on a credit card statement. After each statement you should receive, you should thoroughly review it in order to see if there are any charges from companies you do not recognize, duplicate charges or any other changes you do not recognize.
For more information on what to look for in a credit card statement and other effective methods to manage credit card bills, visit Punch Associates for expert advice
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