If you’re like the average American, you have multiple credit cards in your wallet. And, if you use those credit cards properly, they can offer rewards, help with budgeting and more. On the other hand, using credit cards improperly typically leads to mounting debt, significant interest charges and it could even end in financial hardship or bankruptcy. 

But, credit card mistakes are relatively easy to make, even though making them can have a detrimental impact on your financial wellbeing. So, what are those mistakes and how can you avoid making them?

Find out how a debt relief company can save you money on your credit card debt now. 

4 important credit card mistakes users should avoid making now

Credit card mistakes can put you deeper in debt, keep you in debt longer and costs you more money than you should be spending. Some of the most important credit card mistakes to avoid, then, include: 

Staying in high interest debt

Credit cards typically come with high interest rates. In fact, interest rates on these accounts average over 20%. That can get costly if you carry a balance from month to month. And, if you stay in high-interest debt for the long haul, you could spend tens of thousands of dollars in interest over the life of your debt. 

So, if you have a significant amount of debt ($7,500 or more), it’s time to take action. The good news is that there are several debt relief programs that may be able to help you pay off your credit card debt relatively quickly while saving a meaningful amount of money – both in the long term and in terms of monthly payments. Consider reaching out to a leading debt relief company for help.  

Get out of high interest debt with a debt relief service today. 

Not taking advantage of lower interest borrowing options

There may be times in life when borrowing money isn’t just something you want to do, it’s something you need to do. For example, say you need to make repairs to your home, but you don’t have the cash on hand to cover the cost. Borrowing money makes sense in this instance. 

But, your first move shouldn’t be to reach for a high interest credit card. There are lower-interest borrowing options to consider. For example, consider taking advantage of a home equity loan or home equity line of credit (HELOC). Both of these options have average interest rates in the single digits – which could offer significant savings when compared to credit cards. 

Only making minimum payments

Minimum payments are just that – they are the minimum amount of money that you’re required to pay toward your credit card debt each month. But, only making minimum payments can become costly. 

“One mistake credit card users should avoid is only making the minimum payment each month,” explains Dan Casey, investment advisor and founder of the financial planning firm, Bridgeriver Advisors. “Making this mistake can extend the balance for many years.”

Instead, you should get creative with your payments. “If you have multiple cards with lower interest rates, consider making the minimum payment on those so all of your disposable income can be applied to the card with the highest rate,” says Casey. This is known as the debt avalanche and offers meaningful savings by prioritizing the payoff of your highest interest rate debt first. 

Overusing your credit cards

“Another mistake is not cutting out all non-essential charges,” says Casey. Ultimately, there may be times when using a credit card for food or gas becomes a necessity. However, before you swipe your card, you should ask yourself, “is this an essential charge?” If you answer, “no,” then you shouldn’t use a credit card to pay for it. 

The bottom line

Credit cards can be a smart financial tool when used properly. But, when used improperly, they can also become a financial nightmare. If you already have mounting credit card debt, consider reaching out to a debt relief service for help. If not, avoid high interest debt by taking advantage of other borrowing opportunities when you need access to money. And, when you do use your credit cards, make a point to send more than minimum payments to pay your debts off quickly.