Credit cards can be the bane of your financial well-being. In my case, it’s just a means for not having to carry around cash. Problems with your credit card can be avoided if you avoid these common mistakes.

Having more than 1 credit card. You only need one. The more you have, the more likely you spend it. More hardcore finance gurus would say that you should never buy anything on credit hence there is no need for a credit card. But plastic can be handy at times especially when you don’t want to carry a cash around.

Using for the sake of rewards and points. Many credit card companies will lure you with points. Mind you that the rewards they offer are little to no value at all compared to the interest (or the risk of) with the purchases you need to make in order to get enough points.

Not paying monthly. Interest rates kill. So the longer you leave your card balance unpaid, the more you’re charged with interest. That simply means you bury yourself in more debt every time you decide not to pay.

Not paying in full. The best way to avoid interest is to make sure that you don’t owe the company any money at all at each cut-off date. So aside from paying monthly, be sure to pay in full.

Not knowing when to pay cash. My rule of thumb when using credit cards is to use it for purchases where the cash and card prices are the same. When you purchase cash, you do save the merchant a good amount of cash since they won’t have to pay transaction charges unlike with card purchases. Some are willing to give you back that slice through discounts.

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