Are You Guilty of Committing These 11 Credit Card Mistakes?


Credit cards are convenient to have when we have large purchases we want to make or we have a financial emergency. Having and using credit cards does require us to be financially responsible. Otherwise, we can find ourselves making one or more of these credit card mistakes:

  1. Maxing out all of your credit cards. Not having any credit available is never a good idea. Not only is your credit score lowered, but you also end up paying a lot in interest.
  2. Taking cash advances to pay your other bills. Cash advances are great if you have an emergency. However, they often have a higher rate of interest associated with them, and some even have a hefty cash-advance fee.
  3. Not paying your credit cards on time. This mistake could result in being charged a late payment fee, which is often more than the minimum amount due. On top of that, paying late could put you over your limit and lower your credit score.
  4. Failing to read the fine print when opening a credit card account. There could be important information in the fine print like the costs of fees and how interest is calculated. Take the time to read through this before submitting your application.
  5. Opening too many credit card accounts. Having more credit is not always better. You can stretch yourself too thin and then discover you cannot afford all the monthly payments on the cards.
  6. Closing a credit card account. Whether it is paid off or still has a balance, closing the account will affect your credit score negatively. It is better to keep the account open, even if you no longer use it.
  7. Exceeding your credit limit. When you go over your credit limit, you could be charged an over-the-limit fee, which can be as much as or more than the late payment fee.
  8. Not paying attention to your credit report/score. Failing to do so could result in you discovering later that you were the victim of identity theft and credit card fraud. It is better to monitor your credit report and score monthly.

woman paying online with a credit card

  1. Getting credit limit increases every time you max out your cards. Most credit card issuers are more than happy to increase your credit limit if you pay on time. After all, the more you spend and the more you owe them, the more in interest they will earn.
  2. Paying only the minimum amount due each month. If you only pay the minimum amount due, you end up paying a lot more in interest. It is better to pay a little bit more each month, so you can pay down the card faster and save money on the interest.
  3. Going on shopping sprees. Many of us make the mistake of just charging everything when we go on a shopping spree. Before we know it, we have hit our credit limit and end up buying more than what we really needed.

The best way to avoid making these mistakes is to establish a credit card spending budget, make payments on time, and try to keep balances as low as possible.

If you are looking for a credit card with a low interest rate, no cash advance fees or balance transfer fees and optional rewards, apply for your MasterCard at The People’s Federal Credit Union online, stop by your nearest branch location, or contact us at 806-359-8571 today!

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