Credit cards help you use your money quite flexibly, rewarding you with travel points or cash back. They are also useful in situations where you are short on money or an emergency. However, credit card debt is something that you want to steer clear from.

For those of you who are looking for ways to avoid debt, continue reading to see the Three Strategies To Avoid Credit Card Debt.

Table of Contents

The Best Strategies To Avoid Getting into Credit Card Debt

1. Run the Numbers

Keeping track of the various numbers such as the annual percentage rate (APR), the dates of grace periods, how much interest you might pay, and more, associated with your cards is a good way to be responsible.

Credit cards can help or hurt their users. Understanding this will help you reduce what you spend money on:

Rebate programs — This could include points, miles or cash value. Knowing how these work and what value they provide helps you make the most out of each card.
Fees — Late fees and annual fees can might hurt you unexpectedly, potentially adding up in fees if the balance is not paid off.
Discount programs with partner vendors — This common credit card benefit can save you serious money if you’re able to navigate the field.

Pay attention to how much you spend with your credit cards. You should know what you can afford to pay off before the end of your grace period. Don’t carry a balance if you don’t have to.

2. Only Use It as a Credit Card

Use your card to make simple purchases that you can afford to avoid unexpected fees or charges. Keep in mind that some credit card companies might charge a fee for some services offered. These fees can rack up without warning. The three most common services are:

Balance Transfers –This means taking the balance you carry on one loan, and moving it to a credit card. It might be attractive because of the low-interest offers, but they always come with a balance transfer fee that can often exceed the interest you would have paid if you’d left the original loan alone.
Cash Advances — If you need cash quickly, you can use a “convenience check” to take it from your available credit card balance. These invariably come with an additional fee, and many are charged at an extra-high interest rate. Using this option is almost never worth the cost.
ATM Functionality — A few cards let you withdraw money at an ATM, using them just like your bank card. This is even more convenient than a “convenience check” but comes with all the fees and extra interest of a regular cash advance. Plus, you’ll pay off-bank ATM fees on top of it all.

Keep up with an emergency fund rather than relying on your credit cards for unforeseen situations.

3. Practice “Credit Hacks”

There are a few practices you can use to keep your credit card debt down. These vary depending on your situation, but it is important to understand them all to keep yourself from going down the wrong path:

Delete the auto-filling option of credit cards from your home computer and smartphone. This will help prevent the impulse buys online.
Don’t carry your credit card in your wallet or purse. Try to leave it at home somewhere safe and take it out when needed. Similarly, this helps reduce impulse shopping.
Think carefully before accepting a credit limit upgrade. It’s nice to have that extra funding but also increases the temptation to begin carrying a balance.
Shop for a new credit card once a year, and don’t hesitate to change which one you use the most based on the deals and offers for each card. Just make sure not to cancel or close any of your older credit cards — the longer you’ve had a card, the better your credit score. Store the cards you’re not currently using somewhere safe.

Bottom Line

Using credit cards can make your financial life easier but it is important to use it in moderation. In this post, we have listed some strategies for those of you who are looking for ways to avoid credit card debt.

Start off by considering your own financial situation and think about which of the methods we listed above will most work for you! For more posts like this, check out our list of credit card bonuses!