Millions of Florida residents and others across the country have at least one credit card. While some may struggle with excessive credit card debt, many utilize their cards effectively as part of their household budgeting process. However, experts cite several mistakes routinely made by cardholders that should be avoided to maximize the potential benefits of credit cards.
Analysts stress that one of the largest costs of credit cards can be the interest that accumulates on balances. Credit card debt for the nation has now exceeded $1 trillion. While it is not always possible to pay the full balance on a card, it is recommended that someone pay more than the minimum balance due each month.
Experts also suggest that credit cards should not generally be canceled. When a credit line is canceled, it can negatively affect someone’s credit score since it considers both the number of open accounts and amount of available credit. In addition, it is wise to shop around for reward programs that best fit someone’s interests rather than simply staying with a standard card. While retail establishments often incent shoppers to get cards, they often come with higher interest rates than a typical credit card.
Many consumers resist the idea of having a credit card at all. Millennials have not had the same access to credit as previous generations, due to the Credit Card Accountability Act of 2009. However, building and maintaining a strong credit score is important for many financial endeavors, such as getting loans or renting an apartment. On the other hand, poor credit can be costly as it can lead to paying higher interest rates.
Credit card debt may be overwhelming for some Florida consumers. It would be beneficial to seek the guidance of a knowledgeable bankruptcy attorney. An experienced lawyer can help clients develop a plan to reduce credit card debt and to get back on track financially.
Source: wreg.com, “How you could be using your credit cards all wrong“, Aug. 1, 2017