How to guard against credit card rip–offs
Most of us credit cards and they seem to be a part of our lifestyle. People use credit cards as a convenient mode of payment at restaurants retail outlets etc. These days, it is common to see people doing online shopping with the help of their credit card. Credit cards are very useful to us but this is only one side of the story. People should be aware that there are hidden costs behind that credit card you own. If you are not alert, then get ready to be shocked after you receive your monthly credit card statement. Credit cards are easy to use but if you don’t deal with it in the right way, you will end up paying various charges. In order to prevent yourself from paying any credit card charges, you need to be aware of the following circumstances.
You must make it a point to pay your maximum due amount or else you will end up paying a late payment fee. The fee will vary from bank to bank.
Credit cards are introduced with the main aim of being able to meet immediate cash requirements. However, spending on credit cards has undergone a big change. People are using credit cards to buy branded apparel, gold ornaments, and fancy electronic gadgets. It becomes easy to buy but you must also pay back your entire credit card dues. If you will not pay your entire due but only try to settle the minimum amount due on your card every month, in that case you will land up bearing hefty charges costs. This will be followed by late payment charges and other penalties.
Withdrawing cash from a cash machine using a credit card can be similar compared to as throwing money away. You should go for this option only if you are truly desperate. Card issuers normally charge a 2% to 3% fee for cash withdrawals. You are instantly charged interest on the withdrawal amount. On the other hand, if you would avoid withdrawing cash from a cash machine and use the card through a normal way of card purchase, you would have then benefited with the standard 50 days- plus interest free period facility for making purchases by using the credit card itself.
It is not advisable to take a long term loan using a credit card. Due to huge credit cards interest rates, it would be highly advisable to take help of a personal loan provider as this step will fall cheaper to you.
As earlier mentioned, credit cards are related with very high rates of interest. So, if you want to purchase the latest electronic gadget, it does not make sense to pay huge interest cost for items that have low value. It would be preferable to collect money over a period of time and then go for the purchase of the electronic item using hard cash.
