3 Signs You’re Not Managing Your Lines of Credit Responsibly

February 12th, 2013 · No Comments

There are three warning signs that tell you you’re mishandling your existing lines of credit, and they include the following:

Man Worried About His Credit Card Transaction

Man Worried About His Credit Card Transaction

You make substantial payments on pesky fines and penalties. Take a close look at your monthly billing statements. If you think you make huge payments on extra charges, such as late payment fees and other related fines then, it only means that you frequently miss out or skip on your dues. Always remember that such charges can eventually eat up a significant percentage of your personal budget and soon compromise the funds you’ve initially set aside for your personal savings and even for some of your monthly expenses.

Hence, if you discover that you spend a great deal of cash on penalties and fines then, it’s about time you make serious changes in the way you handle your credit accounts. For instance, if you find it difficult to keep up with your bills; you might as well sign up for automatic payment options with your bank. By doing so, you won’t have to worry about being delinquent on your financial obligations, anymore.

You may also decide to set-up personal reminders and alerts in your mobile gadgets. That way, you can easily remember when a payment must be made.

Use Personal Reminders to Keep up with Your Due Dates

Use Personal Reminders to Keep up with Your Due Dates

You have a low credit score. Have you ordered the latest copies of your annual credit report? How’s your credit score? If you think your current rating won’t be enough for you to qualify for affordable credit programs then, it’s a clear indication that there’s something wrong with the manner by which you manage your existing lines of credit. After all, your credit and payment habits, credit utilization, as well as the number of your existing lines of credit influence the computation of your credit score.

This means that if you wish to receive excellent credit offers, later on; then, you should pay close attention to how you use and manage your unsecured or secured credit card and personal loan. For cardholders, make sure you use just a reasonable percentage of the spending limit of cap imposed on your credit accounts.

Meanwhile, for loan takers, see to it that you abide by the terms and conditions of your credit programs. And use the proceeds of your respective loans wisely. By doing so, you can have ample funds to finance your urgent needs, without inflicting damage to your credit history.

You pay steep interest charges. Do you make substantial payments on interest? If you do then, you should now realize that submitting just the minimum amount due, to your card issuer or to your lender, is a big NO-NO.  After all, such habit will not just cause your interest payments and even your accumulated debt to balloon out. It can also inflict damage to your credit history and cause your credit score to drop.

Paying Steep Interest Charges is a Sign of Irresponsible Credit Habits

Paying Steep Interest Charges is a Sign of Irresponsible Credit Habits

So, as early as today, you should resolve to submit, not just on-time, but also complete payments to your unsecured or secured credit card issuer as well as to your other creditors.

About the Author

Alexandra “Alex” E. Smith is a certified finance expert and one of the featured writers of Bad Credit Credit Card Site – a website that caters to questions about bad credit-credit cards, such as prepaid, unsecured, and secured credit cards. To read more of her posts, please visit their site, right away!

Images: FreeDigitalPhotos.net

Tags: credit card management

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