Aquib Nawab
Personal Finance
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Late payments are one of the biggest credit card slip-ups. They negatively impact your credit score. Set up reminders or automatic payments to avoid late payments.
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Credits: Canva
Paying only the minimum keeps you in debt longer. For example, paying the minimum on a $1,000 balance with 20% interest will take nearly 10 years and $1,056.74 in interest to pay off.
Having high balances or maxing out your card can hurt your credit score. Your credit utilization ratio should be below 30%. Lenders may view high utilization as irresponsible debt management.
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Credits: Canva
Regularly check your credit card activity to detect fraudulent charges early and avoid expensive consequences. Cybercriminals are on the rise, and ignoring fraud can be costly.
Reading credit card terms can prevent unexpected fees. Understand introductory rates and balance transfer fees to avoid surprises by reviewing the fine print.
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Credits: Freepik
Different cards serve different financial goals. Research the best options for your needs and lifestyle, and avoid cards with unnecessary fees.
Overspending can lead to financial trouble. Avoid making purchases solely for rewards, and don't justify extra spending for minimal rewards.
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Multiple credit card applications can harm your credit score. Space out applications and be strategic, waiting at least 90 days between applications.
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Closing a credit card can negatively impact your credit. It can reduce your credit limit and increase utilization ratio. Consider alternatives like product changes or downgrades.
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Higher credit limits can improve your credit utilization ratio. Request increases once a year if needed, but be cautious not to increase your balance along with the limit.
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