Credit Card Mistakes:

Credit cards are helpful financial tools, but if not used wisely, they can cause serious money problems. While they offer convenience and rewards, careless use can lead to high-interest debt, late fees, and a poor credit score.

Credit Card Mistakes:

Take the example of Sreenath (name changed). He owns four credit cards and often uses one to pay the dues of another. Sometimes he even adds money to a digital wallet from one card to pay another card’s bill. This cycle of borrowing causes extra charges, like 2.5% on cash withdrawals and transaction fees, making his financial situation worse.

On the other hand, Rakesh (another fictional example) linked his credit card to his bank account to avoid missing payments. He smartly used the interest-free period but faced risks too. In case of a wrong charge, the money gets auto-debited, and it takes time and effort to recover it. Autopay may also cause payments for unwanted services, like forgotten subscription trials, to continue month after month.

Many people forget to pay their bills on time. This not only attracts penalties but also affects their credit score. A low score can result in loan rejections later.

Credit cards often promote reward points, cashback, or air miles. But these benefits usually offer very little actual value—often just 0.5–1% of your spending. In many cases, these points can only be redeemed on specific platforms, limiting their usefulness.

Instead, debit cards and UPI wallets are safer options for regular spending. With debit cards, you can only spend what you already have, which reduces the risk of overspending.

So credit cards can be very useful if handled with discipline. But if misused, they can lead to debt and financial stress. It’s important to spend only what you can repay comfortably and be cautious with features like autopay and reward schemes. Sometimes, it’s better to pay upfront than to chase small perks with high hidden costs.

Also Read:6 Everyday Habits That Might Be Causing Weight Gain

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