REIT-TIREMENT - REIT Investing and Personal Finance

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Friday, July 26, 2019

Healthy Habits for Credit Card Users

Previously, I've share about A New Tool to Maximize Cashback & Miles, which is about a new website call Whatcard.sg which you could key in merchants that you always buy from, and find out which credit cards offer cashback or miles.

I believe everyone love cashback or miles from credit cards, however, credit card is a double edge sword, if you are not careful enough, you would end up in debts before you knowing it. For this post, let us explore some healthy credit cards habits.
Use credit card to you advantage; not to you demise
1) Check Your Credit Card Statement
Always check your credit statement for any errors or financial charges like annual fee or late payment fee. Generally, banks are willing to waive off these financial charges. There was once I found out annual fee charge after 2nd billing cycle, which I have already paid for both billing cycles. I called the bank, and yes, they waived it off and credited back the amount. However, should banks rejected your waiver request on annual fee, you could just cancel it and there will be no charge for this annual fee.
Check Carefully
2) Pay Your Bills on Time
Always pay all your credit card bills before payment due date to avoid any late payment charge. Different credit cards would have different billing cycles which could cause confusion. One way to overcome it is to check online and pay your outstanding amount in 2 different dates every month, e.g. every 1st and 15th of a month. Should you miss out payment due dates and get late payment charge, do call the bank to waive it off.
Pay Timely
3) Pay Your Bills in Full 
Besides paying your bills on time, you should also pay you bills in full sum. Most credit cards in Singapore charge interest of 24% p.a., which is a very high rate. If you only make minimum payment, then your debt would snowballs with compound interest. If you really having difficulties to pay credit card bills, you could consider to make a balance transfer. Do note that balance transfer is still debt, it merely is a tool for you to reduce unpaid credit card interest. For more detail about balance transfer, you could refer below:
i) SingSaver - Unpaid Credit Card Bills? Here’s How A Balance Transfer Can Help
ii) GoBear - What You Need to Know about Balance Transfer
iii) Dollar and Sense - Pros And Cons Of Taking A Credit Card Balance Transfer
Pay Fully
4) Spend on What You could Afford
Spend only on things you could afford and on the amount you could pay back within the same billing cycle. If you are buying big ticket items with interest free installment, do double check and ensure those purchases are really "interest free". Some banks would charge a processing fee, and in most case, you would not get any cashback or miles from these installment purchase. Also note that if banks charge you annual fee during your installment period, you can expect that most banks would not waive this annual fee off.
Spend Wisely 
5) Optimize Rewards
a) Use credit cards that match your spending habits, which you could check from Whatcard.sg.
b) Take note of minimum monthly spending requirement and cap on those rewards. Also take note on weekend and weekday reward rate, it could make a big difference. If you are close to minimum spending, buy some groceries vouchers to top up.
c) Choose credit cards which provide extra interest on your saving accounts; or vice versa, change your saving accounts to those banks in which provide extra interest when using their credit cards. You could refer below for more about Singapore saving account interest rate:
i) Seedly - Cheat Sheet: Best Savings Accounts in Singapore For Working Adults 2019? – Highest Interest Rates
ii) Dollar and Sense - [2019 Edition] Best Savings Accounts for Working Adults in Singapore
iii) MoneySmart - Your Savings Account Sucks, Here Are Some That Don’t – 2019 Edition
Reward Handsomely
Do you also have any other good credit card habits to share? Feel free to leave you comment. 

4 comments:

  1. This short article posted only at the web site is truly good.

    ReplyDelete
    Replies
    1. Hi Jackleen, thanks for your compliment. Do share with others if you find it useful.

      Delete
  2. Awesome short article. Keep posting.

    ReplyDelete