Millennials have it tough. From the challenging job market to less desirable housing options, not to mention paying off student debt, young folks have to constantly wrestle with their finance. And with credit cards, it’s sometimes a losing battle. Here are some ways on how to avoid credit card debt.
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Avoiding unnecessary purchases is always the top tip people can give millennials with credit cards. This is one problem shared by everyone. Buying things one wants but doesn’t necessarily need can rack up on credit card debt and get out of hand. A good rule of thumb is to ask yourself if you can pay for the item using cash. If the answer is no, do not buy.
Paying on time saves users from nasty fees. New users could easily mistake these fees as simply one-time items like a separate purchase. However, late payments can hike up one’s interest rate if it becomes habitual. Not only does this result in a bigger debt, but it also damages one’s credit rating.
Never lend your credit card to anyone without your supervision. You may be disciplined in how you use your card, but maybe your friend who’s in need doesn’t have as much restraint as you. And keep in mind, on the off chance they don’t pay you back, it’s your credit ratings that suffer.
Lastly, limit the number of cards you have. People who use multiple cards can have problems tracking which one needs to be paid off. Overdraft issues are also common for multiple card holders.
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