Here are some tips what not to use your credit card for.
- Do not use your credit card to cover your shortfall in monthly debt commitments or living expenses - you will never repay the debt.
- Do not have multiple credit cards - it increases your debt exposure.
- Do not use your credit card for purchases you have not budgeted for - add up to 26% interest to every purchase: for every R100 purchase you are charged R26.00 interest.
- Do not use your credit card to purchase gifts or "splurge" items - use retail accounts that have 6 months interest free plans.
- Do not increase your credit facility automatically - unless your income has increased to cover the repayment.
- Do not use your credit card as a current account. Certain banks have current account packages which covers swiping and electronic transactions - these are not applicable to credit cards.
- Do not use your credit card for monthly transactions, unless you're able to settle the balance within 55 days. Certain banks have a 55 day interest free period if the balance is settled in full within 55 days.
- Do not use your credit card to consolidate debt. Certain financial institutions have debt consolidation loans at lower interest rates.
- Do not use your credit card to finance study loans for students. Certain financial institutions offer Study Loans at discounted rates.
- Do not use your credit card to finance items you could have saved for - sometimes ‘Cash is King'.
