In this day of easy credit and a world of online bargains, it’s important to remember some simple credit card rules particularly as the festive season approaches.
While promises of interest-free periods and enticing offers of up to two months to pay off credit card debt beckon our attention, we all need to pay close attention to the terms of the interest-free periods on our credit cards to minimise any extra fees and charges.
I’m not saying that interest-free periods can’t be used effectively but it is very important to know when the due dates of your credit card fall in your calendar month.
For instance, just say you have a lovely time shopping in November, buying your family and friends gifts from Santa, and then again in December you buy more lovely gifts on your credit card, if you spend more than you can actually afford to pay back and you can’t cover the entire amount within that two month ‘honeymoon’ period, you will find yourself paying interest on both your November and your December spend.
All because you didn’t pay the entire amount owed on your credit card within the interest-free period.
If you are using direct debit to pay your credit card balance, it is important to know how long it will take to transfer the money. Sometimes online transactions can take up to 48 hours, so always consider this when you are calculating your payments and scheduling them from your bank account.
And it is important to research your credit card. Shop around and be wary of credit cards that have high annual fees and/or high interest rates.
Canstar research from 2013 advised that the average credit card rate for customer-owned banks was more than 4% lower than the rates on major banks, and customer-owned bank credit cards included lower annual fees and longer interest rate periods.
The Beyond Bank credit card  was recently awarded a 5-star rating from Canstar for outstanding value and has been recognised within the industry as being one of the better low rate options for consumers who are looking for a credit card.
What are your tips for managing your credit card?