5 Common Credit Card Mistakes To Avoid For A Healthier Wallet
Getting your first credit card can feel exciting—and empowering. But with that shiny piece of plastic comes responsibility. Misusing your credit card, even unintentionally, can lead to debt traps and a poor credit score. To help you start off right, here are five common credit card mistakes you should avoid.
1. Paying Only the Minimum Due
Paying just the minimum amount each month might seem manageable, but it’s a trap. Credit card interest rates are sky-high, and if you only pay the minimum (say ₹5,000–₹7,000 on a ₹1 lakh bill), the remaining balance keeps collecting interest. Over time, you could end up paying far more than you originally spent.
Pro tip:
Always try to pay your full bill on time to avoid mounting interest.2. Missing Payments
Even missing a single payment can hurt. Apart from late fees, your credit score takes a hit—and that damage can stick around for years. A lower score can affect your ability to get loans, better credit cards, or even rent an apartment.
Pro tip:
Set up reminders or auto-pay to ensure you never miss a due date.3. Maxing Out Your Card
Using your full credit limit isn’t a smart move. High credit utilization (especially above 30%) can lower your credit score and may even lead to over-limit fees on some cards.
Pro tip:
Aim to keep your usage below 30% of your total credit limit.
4. Withdrawing Cash Using Your Card
Need cash in a pinch? Don’t use your credit card for that. Unlike regular purchases, cash withdrawals attract a fee and start accruing interest immediately—no grace period.
Pro tip:
Use a debit card or other alternatives for cash; avoid tapping your credit card at the ATM.5. Ignoring Fees and Fine Print
Annual fees, foreign transaction charges, and balance transfer costs can eat into your rewards and savings. Not being aware of these terms can cost you more than you expect.
Pro tip:
Take time to read the terms and conditions. Knowing your card inside out helps you make better decisions. Credit cards can offer rewards, convenience, and even credit-building benefits-but only if used smartly. Avoid these five pitfalls, and your credit card can be a valuable ally instead of a financial burden.