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Our Team’s Best and Worst Credit Card Advice

May 23, 2019


It has been said that lessons in life will be repeated until they are learned – so our team has set out to help! We’ve polled our team for their best and worst advice on different financial topics. In this post, you’ll find out some of the best and worst credit card advice we’ve received along with a few practices to pay off credit cards. We may not be credit management experts, but as accountants we do understand the cost of borrowing and always try to save money where we can and be fiscally responsible.

Best credit card advice we’ve received:

• Pay off your credit card every month.
• Never finance long term expenditures with a credit card.
• If you use one, keep a very low balance – under 30% utilization if possible. (Note: A principal scientist for FICO mentions that “consumers with FICO scores of 800 use, on average, 7% of their available credit”.)
• If you must carry a balance, look into transferring to a card with an interest free transfer period.
• Don’t put anything on the credit card that you couldn’t write a check for (don’t spend what you don’t have).
• While you don’t need every credit card that is offered to you, how you utilize the cards is more important than how many accounts you open.

Worst credit card advice we’ve received:

• It’s fine to max out your credit card.
• Finance long term expenditures with a credit card.
• Open one at every store.
• Credit card debt is ok if you can make the minimum monthly payments.
• Always use your credit card.
• It’s ok to carry a balance and pay it off later.
• Use credit cards to pay off your other debts.
• Transfer your balance to a new credit card.
• Carry a balance because it improves your credit.

Best Practices for Paying off Credit Cards

• To save money in the long run, focus on paying off cards with the highest interest rates first.
• You could also take the approach of paying off cards with the lowest balances first. Once you have paid off the first card allocate that extra money to pay on other credit cards. Continue this until all cards are paid off.
• Pay more than the minimum required each month.
• Revamp your budget and if you find any places you can cut back, use this money to pay down your debt.
• Increase frequency of payments and amount of payments made.

“As long as you have debt, the money in your checking account is not even yours” – Patrick Gill