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Pay Off Credit Card Debt  

Pay Off Credit Card Debt  

Credit cards offer a moment answer for cardholders with the greater part of their buys and issues. Practically all banks offer a wide scope of credit cards for various necessities.  

Despite the fact that these cards are an incredible monetary arrangement, if not utilized intelligently, cardholders can undoubtedly fall into an obligation trap. As credit cards increase your purchasing power, so they have to be handled well.  In the event that you do a great deal of superfluous buying without reconsidering and don’t clear your bills on schedule, your Mastercard turns into an obligation toward the month’s end with an enormous bill to pay off. And this can lead you to a debt spiral. So, you need to be very cautious when it comes to using your credit card and making payments through it.  

Let’s have a look at some of the situations that lead to delayed payments: 

  • Overspending money and failing to pay the outstanding dues on time due to lack of sufficient funds 
  • Depending on physical bills as it causes missing due dates due to postal delays 
  • Waiting until the last day to clear the bill to utilize most of the interest-free period and then missing the due date 
  • Getting confused about the billing date and payment due date 

No matter whatever the reason is! Missing a credit card due date is a big deal and can cost you a lot. Your credit card providers won’t come at your doorstep to ask for the payment. You have to do it yourself. Why? Let’s have a look at some of the reasons that justify this. 

Reasons Why You Should Clear Your Credit Card Dues: 

  1. To Avoid A Late Fee 

You might end up paying a late fee if you pay your credit card bills after the due date. The concerned bank will add the late fees in your next credit card bill. So, don’t take any chances and pay your dues on time to avoid a late fee. 

  1. To Avoid A High Rate Of Interest 

The rate of interest (ROI) on your due amount will increase if you don’t pay the outstanding bill by the due date. This increase in interest rate will be applied to cash withdrawal and purchases made by you if you continue your purchasing using the same credit card with an outstanding bill amount.  

  1. To Avoid The Adverse Effect On Your Credit Score 

Your creditworthiness (the ability to take credit) depends on your credit score. This credit score is used by banks or other lenders to assess your ability to repay a loan. Your payment history will leave a significant impact on your credit score. So, late payments affect your creditworthiness, and you might find it difficult to access loans in the future. Your bank will send default reports to credit companies, and this can lead to rejection of your loan application. 

  1. The Decrease In Credit Limit 

If you have a habit of defaulting your credit card bill payments often, then the bank may decrease your credit limit. It will restrict your ability to borrow, and in turn, your spending capacity will decrease too. 

  1. Withdrawal Of Interest-Free Credit Period 

If you don’t pay your credit card bill on time, it may lead to the withdrawal of the interest-free credit period. An interest-free credit period is usually between 20-50 days. This period offers a great advantage to the users as it is the time for which the bank finances your purchase for free. However, if you don’t make payments on time, the bank will withdraw this. 

So, this is true that credit cards offer you several benefits. For example, convenience, security, funding, and hassle-free usage, but care should be taken at any cost. Do not use it for unnecessary expenses and increase a load of debt on your head. Use credit cards wisely so that the benefits can be achieved to the fullest.