Controlling credit card spending can seem like an impossible task for those with bills in the red due to poor planning. After all, we know that if expenses are not planned and met to the letter, the chances of compromising finances are high. But don’t worry! If you’re in the red and looking for a light at the end of the tunnel, stay tuned for today’s post. We have listed below 5 secrets for you to better control your credit card spending and use this service with awareness.
Do financial planning
You can’t talk about spending on your credit card without elaborating a good financial plan. With it, you know exactly the value of your income, fixed and variable expenses, the destination of your money and how much you will need to save to reach goals. It is also important to list all the financial goals that must be met in a given period, even to motivate the fulfillment of financial planning.
Reduce the card limit
When you use your credit card and not cash, you end up not feeling the value coming out of the account, since you spend today and pay, in many cases, in 45 days. In this sense, the higher the credit card limit, the more money you consider “available for use”. Experts claim that the ideal is that the card limit does not exceed 50% of your net income, that is, the amount you receive after all the discounts on the sheet.
Even if you do not use the card, you must pay the annual fee, depending on the card and the discount and benefits package, it can reach $300. Whenever possible, try to renegotiate these fees directly with the operator. If you use credit regularly and make all your payments on time, you can argue with the operator about the transfers made to it with each purchase. As you know, operators receive a percentage on each purchase you make. Emphasize that by buying a lot, it already guarantees the company a good financial transfer. With similar arguments, many people get discounts of up to 50% on annuity!
Record all expenses daily
To better control all expenses incurred on the card, a golden tip is to register all expenses daily. Thus, you will have full control over what you have spent and what you can still spend. To facilitate this control, it is interesting to bet on financial managers. Good Lenders, for example, allows you to synchronize the application with your bank account data, automatically categorizing all current account and credit card entries.
Avoid accumulating parcels
Dividing many purchases into even the smallest installments makes the bill big in the end. Try to split only those purchases that you would not be able to pay in cash. If you have two things to buy, give priority to the one that is most essential and leave the other one for the following month.
Pay the full amount of the invoice
Paying the minimum amount of the invoice is, without a doubt, one of the biggest risks offered by credit cards. It is well known that the interest rates applied by card companies are one of the highest in the financial market, second only to financial companies. Choosing the minimum payment increases the level of indebtedness and often makes invoices priceless the so-called “snowball” effect. If you realize that you will not be able to pay the invoice in full, one way out is to look for lower interest loan types and replace the one given.
On the Good Lenders website and in the application itself, you can compare and contract loans at different institutions. Do you know how to control credit card spending? With our tips you will certainly organize your financial life better. To continue following us and receiving updates on personal financial control, like our Facebook page.