Making Minimum Payments
Just paying the minimum requirement is a costly mistake. Just paying the minimum will cost you a lot more in interest over the life of the card and paying it off will take much longer. Your credit card statement will show you how much you would pay if you only pay the minimum. It’s important to read this, you would be surprised at how much that number actually is and how many years it will take to pay off.
Not Reading the Fine Print
Do you understand your rate. Many credit cards feature an introductory rate for a certain period before the real rate kicks in. Some cards also come with an annual fee. It’s important to know what you are getting into and how much these rates and fees may cost you.
Ignoring Your Statement
It’s important to read your statement each month. Unlike a bank account, you may not keep close tabs on your spending, reviewing your statement can help determine if you were charged incorrectly for something or if there is fraud on your account.
Keeping a High Balance
One of the factors looked at when determining your credit score is your credit utilization – how much credit you have used of your allotted amount. It’s a good rule of thumb to use 30% or less. So if you have a $6,000 credit card limit – try to keep your balance under $1,800.
Not Taking Advantage of Benefits
It’s difficult to find a credit card these days that does not have added benefits. Are you taking advantage of your rewards? If your card offers discounts or freebees, don’t let them go to waste.
In the market for a credit card? Sikorsky Credit Unions offers some great credit card options, check them out here.
While having a credit card is a great way to build credit, sometimes they can get you into trouble. Small mistakes can cost you more money or put a dent in your credit report. Here are some common mistakes to be vigilant of that you could be making: