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5 ways to use your credit cards more responsibly in 2025
Credit cards can be a valuable financial tool, offering flexibility, convenience and lucrative perks. But without proper management, the credit cards in your wallet can also lead to financial instability — which is what a large number of cardholders are dealing with right now. Recent data shows that credit card debt nationwide has reached a new high of $1.17 trillion, and millions of cardholders are now either maxed out or seriously delinquent — or both. These troubling trends highlight the need for more responsible credit card usage.
As we move into 2025, there’s no better time to revisit how you use your credit cards. Responsible credit card usage isn’t just about avoiding debt, after all — it’s about making your credit cards work for you. That could mean finally pay off your lingering credit card balances, improving your credit score or optimizing your spending to align with your lifestyle and priorities. Even small changes to your habits can add up to significant financial improvements over time.
Whatever your goals may be, though, achieving them requires understanding how to use your credit cards wisely. So what changes should you make to be more responsible about your credit card usage in the coming year? Below, we’ll detail five steps to take now.
Start tackling your expensive credit card debt today.
5 ways to use your credit cards more responsibly in 2025
The following strategies could help you keep your credit card usage on track in 2025:
Get rid of your high-rate card balances ASAP
If you’re carrying balances on cards with high interest rates, make it a priority to pay them off as soon as possible. Start by using traditional payoff strategies like the debt snowball method (paying off the smallest balances first) or the debt avalanche method (tackling the balances with the highest interest rates first). These methods can save you money on interest and give you a sense of progress.
If you’re overwhelmed by high-rate debt, you can also consider seeking more help. Debt relief options like debt consolidation or debt settlement might be worth exploring in these situations. A debt consolidation loan allows you to combine your credit card balances into one loan with a lower interest rate, simplifying payments and saving on interest. Debt settlement, while more extreme, can help reduce the total amount you owe, and in some cases, it could reduce your balance by 30% to 50% or more.
Find out more about your credit card debt relief options.
Cut (at least some) interest from the equation
With the average card rate hovering above 23%, the interest charges on a revolving balance can add up quickly, making it harder to reduce what you owe. To avoid these charges, transfer your balances to a card with a lower or 0% APR. Many cards offer promotional 0% APR periods for balance transfers, typically lasting 12 to 21 months. This gives you time to pay off your debt interest-free, though you may need to pay a balance transfer fee.
If you plan to make new purchases, consider opening a card with a 0% introductory APR for purchases. This allows you to pay off your spending over time without accruing interest. For those who need structured help with reducing interest, a debt management plan through a credit counseling agency can help by working with your card issuers to reduce your interest rates and fees.
Conduct a critical fee analysis
Card fees can chip away at your finances, so evaluate whether your current credit cards are costing you more than they’re worth. For example, do you have a rewards card with a high annual fee that you’re not fully utilizing? If so, consider switching to a no-annual-fee card or a lower-cost option that better matches your spending habits.
Other fees, like late payment fees or foreign transaction fees, can also add up. If you travel frequently, look for a card with no foreign transaction fees. Some card issuers may also waive the annual fees tied to your card if you ask them to — especially if you’ve been a loyal customer.
Leverage technology for spending control
You should also take advantage of your card issuer’s digital tools to monitor and control spending in 2025. Set up purchase alerts, spending limits and category-specific notifications. Use your card’s app to track expenses in real time and identify areas where you can cut back. Some issuers also offer artificial intelligence-powered insights that can help predict future expenses and suggest personalized savings opportunities, which can come in handy when you’re trying to control your spending.
Build an emergency fund to reduce card dependency
Perhaps the most responsible credit card strategy for 2025 is to reduce your reliance on them altogether. Work toward building an emergency fund equal to three to six months of expenses. This financial buffer can help you avoid turning to credit cards for unexpected expenses, breaking the cycle of revolving debt.
The bottom line
With credit card debt growing nationwide, and other troubling economic signs looming, it’s important to try and get your credit card usage in check as soon as possible. By implementing the strategies outlined above, you can transform your credit card usage from a potential source of financial stress into a tool for building a stronger financial future in the new year. Ultimately, responsible credit card use isn’t about completely avoiding credit cards – it’s about using them intentionally and strategically to support your overall financial goals while minimizing costs and risks.
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Older Americans struggle to afford health care compared with those in other nations
In the U.S., having health insurance is necessary, but not sufficient to ensure access to affordable health care services.
While the U.S. lacks a universal health care system like those that exist in most other wealthy nations, most Americans over 65 are insured through Medicare. Yet even so, they still struggle to afford care, with high out-of-pocket costs putting necessary medications and doctor visits out of reach for many of them, according to new research from The Commonwealth Fund, a nonprofit devoted to promoting an equitable health care system.
These extra costs, for which Medicare beneficiaries are on the hook, make it more difficult for older Americans to receive affordable care compared with older adults in nine other countries. Researchers compared coverage for older adults in the U.S. to health care systems in Australia, Canada, France, Germany, the Netherlands, New Zealand, Sweden, Switzerland and the United Kingdom.
Case in point: Nearly one-in-four older adults in the U.S. spent at least $2,000 in out-of-pocket expenses last year, compared with less than 5% of older adults in France and the Netherlands who spent that much, the study found. Only in Switzerland did older adults report spending more than those in the U.S. on health care.
“The reason to focus on this population is because in the U.S. nearly every adult over 65 has Medicare,” Munira Z. Gunja, senior researcher for international health policy and practice innovations at The Commonwealth Fund told CBS MoneyWatch. While the U.S. stands out as “the only high-income country without a universal health system,” when it comes to the over-65 population, “at least, we are on par with other countries,” she said.
Does Medicare fall short?
But the study suggests that the kind of coverage Medicare plans provide isn’t meeting many Americans’ needs. More older adults in the U.S., 8%, reported delaying or forgoing medical care because of costs than in any other wealthy country, except for Austria. And there are repercussions to not getting the care one needs: One-third of older U.S. adults who said they faced cost-related barriers to receiving care reported being either in fair or poor health.
“We find that while nearly every older adult has Medicare coverage, it is still more expensive than what older adults in other nations face, and because of that, older adults in the U.S. are more likely to skip care,” Gunja said. “When they need prescription drugs, they are more likely to skip getting those too.”
Oftentimes, for example, Medicare Advantage members find themselves seeing out-of-network doctors, which exposes them to “a ton of health care costs,” according to Gunja.
One exception
There’s one area in which Medicare beneficiaries faced few out-of-pocket costs and, as a result, were less likely to skip care — mental health treatment. Less than 5% of residents in all nations skipped mental health care over affordability concerns, illustrating that when treatment is affordable, patients are less inclined to skip seeing the doctor.
“It’s a benefit that’s offered on all health plans, and we see what happens when people don’t need to spend as much on a service,” Gunja said.
Solutions?
When older people skip or delay care, their conditions worsen, leading to sicker patients, who tend to require more costly care. That in turn drives up federal Medicare spending, according to The Commonwealth Fund.
Gunja suggests that the U.S. can look to other countries for solutions that make health care more affordable for older adults. Some examples include capping out-of-pocket expenses and fully covering hospital and physician services.
“Across the board, the U.S. generally comes out last for most measures when it comes to affordability measures,” Gunja said. “Getting health insurance is absolutely necessary. But it’s only the first step. We need to make sure coverage is not just comprehensive, but also affordable.”
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Damage reported after California earthquake, evacuations prompted by tsunami warnings
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