Even though politics
isn’t one of my great priorities in life, it was hard not to be
shaken by the recent Brexit vote. To what extent it will end up
affecting the majority of individuals like us remains to be seen, but
all the talk of recessions and downturns does make you take stock.
All we can do at home is ensure that our household finances are as
stable and healthy as possible.
The big one which seems
to be a problem is debt, and Brits are quietly slipping further and
further into a
dangerous spiral, and living beyond their means. It’s
interesting to note that there is such a stigma surrounding taking
out a loan, yet when it comes to credit cards, many are willing to
swipe or tap away at the plastic without much consideration.
The irony of this is
that credit cards, although convenient, are typically very expensive
if you simply make minimum repayments each month. APRs are usually 20
per cent or more, which is a much higher interest rate than you’ll
generally get on a personal loan if your credit rating is sound.
Using your credit
card to your advantage
Of course, credit cards
can be a force for good too. First of all, using them (and paying
them off) is actually vital to building a good credit score. But the
more appealing perk is undoubtedly the rewards many providers are
throwing at us in order to attract business. Some are offering great
cashback deals every time you spend, while many others are
offering things like vouchers, free travel insurance and significant
discounts on a variety of purchases.
There is no reason not
to make the most of such benefits, and popping your ordinary
expenditure on your credit card as opposed to debit card won’t
cause any harm – provided you ensure that you clear the balance
each month. Because if not, the interest you’ll need to pay will
likely far outweigh any rewards you’ve enjoyed. After all, these
credit card companies are out to make a profit from us.
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