Guiding consumers since 2009

When not to use your credit card

By Staff Writer
A credit card is a good for emergencies and it can get you out of a lot of trouble when you need to pay something you do not have the immediate cash for but many of us do not know which purchases are okay to make on our credit cards.

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'.

 

Recent Articles

Featured Debt counselling – the two sides of the coin

Being overindebted doesn’t just put a strain on your personal finances; it also puts a strain on your state of mind. The best solution is to start the process of debt counselling so that you can escape the debt cycle. But what are the ups and downs of joining this debt relief programme?

Travel ban – how to claim for the loss incurred

As with the recent Covid-19 pandemic, governments sometimes issue travel bans to prevent people from travelling to other countries. This becomes even more complicated if you’ve already planned and paid for your trip. Your flights will be cancelled, and you may lose money from cancelled accommodation arrangements. How do you claim for the financial losses incurred due to a travel ban?

How to finance and insure a second-hand vehicle

Buying a second-hand vehicle may suit your budget better than acquiring a new one. But what impact does an older model have on vehicle finance and car insurance? We reached out to specialists in the field to explain what the financial implications are of pursuing a second-hand vehicle.

Reading your loan agreement: look out for this

Many people don’t read their loan agreements. They just sign on the dotted line without realising that they could be signing their lives away. But it’s important to review your loan agreement before and after taking your loan to avoid future setbacks.

 

Deals

Udemy online course for R180

Price: R180
When: Until 27 March 2020
Where: Online

Educate your kids for free with Skills Share

Price: Free
When: Daily
Where: Online

Take advantage of payment holidays from Standard Bank and Nedbank

Price: Free
When: From 1 April to 30 June 2020
Where: Nationwide