Common Mistakes Made With Credit Cards

Even though the country is currently in a problematic financial situation, there are still many people who are neglecting to pay any attention to the amount that they are spending and how they are spending it. More recently it has come to the attention of money experts of some simple mistakes that many people are making when concerning credit cards.

One of the biggest mistakes made by credit card users is to withdraw money from a cash machine using your credit card. This option to withdraw cash should really only be considered as a last option as it is as good as throwing money away. Many card issuers are now charging up to a 2% or 3% fee for cash withdrawals and will start charging interest on the withdrawal straight away. It is also likely you will be charged a higher APR on the card. The same applies if you decide to use credit card cheques; you will be charged interest straight away. If you are going to use a credit card cheque then you might as well just use your card as the APR charged on credit card cheques is usually a lot higher than the standard APR.

Using your card abroad will also cost you dearly. Many card companies will charge a substantial amount of money if you decide to purchase something abroad with your credit card. Before you go away you should see how much you will be charged to use your card abroad to avoid any nasty surprises when you get home.

Long term borrowing is also a huge mistake made by many with credit cards. With loans currently as cheap as they are it would be silly to pay off a long term debt with a credit card that charges close to 12% APR when there are loans on the market that charge less than 6%.