10 Top tips for using Credit Cards

Wednesday, February 22nd, 2017 by Lisa

1. Think twice. If you don’t think you can manage to make repayments on a credit card, don’t get one.

2. Shop around. Make sure you choose the credit card that is right for you. Interest rates, annual fees, interest free periods and features such as reward points vary from card to card.  Shop around, ask questions and make sure you read the fine print.

3. Only charge what you can afford. Only charge items to your credit card that you know you can afford to pay off within a realistic timeframe. Remember that most credit cards charge additional fees for late payments.

4. Stick to one card. Limit the number of credit cards you have– you shouldn’t need more than one. Fewer cards mean fewer annual fees and fewer interest rates to keep track of.

5. Limit your limit. Consider carefully any offers to increase your credit card limit. Do you need more credit? Will you be able to manage it? Think about decreasing the limit if you have more credit than you need or can afford.

6. Stick within your limit. If you make a transaction that takes you over your limit, you should pay the excess amount immediately. If you don’t, your bank may charge an over-limit fee, and you’ll still have to pay it back!

7. Avoid cash advances. Cash advances and cash-equivalent transactions (eg. using your credit card to get cash from a branch or ATM or to pay another credit card account) are a costly way of getting access to cash, as they incur interest from the date you make the transaction until the date you pay the transaction off in full.

8. If it gets hard, get help. If you have trouble paying off your credit card, don’t be afraid to talk to your bank to see if you can organise a payment schedule that works for you.

9. Know what you’re spending. Read your statements – either when they arrive in the mail or via Internet Banking – and make sure you understand the fees and charges.

10. Pay it off regularly. Try to pay off your credit card every month – or, if that’s not realistic, pay more than the minimum repayment. The more you pay, the faster you’ll reduce your credit card debt.  The new ANZ Everyday Rewards Visa is New Zealand’s only credit card which gives you Reward Points for paying money back.

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