Budget better with your credit card

Are you short on cash this month? Do you have a growing list of bills to pay? At times like these, it's ok to use our credit card to cover minor expenses that you otherwise would have paid for in cash. Many people successfully bridge the gap between salaries by using their credit card. As long as you do so responsibly, there's no harm in using your credit card for those little costs that creep up on you, particularly at month-end.

If you are trying to cut down on your debts, however, it may be time to reconsider how you use your credit card. A good way to start is to reserve the card for small expenses and emergencies, while using cash to pay for all other costs.

Let's take a closer look at how you can use your credit card as a tool to fill those gaps in your budget.

Prioritise payments and bills

Your first step is to make a list of all your payments and accounts and decide which ones must be paid first. It's not ideal for you to pay your accounts late. These kinds of bad habits reflect in your credit score. Try your very best to make all payments on time.

Review your credit card balance and due dates

Take note of your credit card payment due dates. Paying your account after this date will result in you paying interest. Right now, the last thing you need is to pay more money than you need to. If possible, pay your monthly balance in full.

Eliminate unnecessary expenses

Now is also a good time to have a look at what you actually spend money on. Download your credit card statement and examine the items on the list and the places where you shopped. Did you spend wisely? Does your statement consist of luxury items? Try to use your credit card only when necessary to cover the cost of groceries, emergencies, personal items, and utilities. Everything else can be paid for with cash.

Adjust your budget

Now that you have a better understanding of how your credit card is used, you can amend your budget to suit your needs. For example, you could allocate a certain amount of money for groceries each week and commit to using your credit card for this only. This is a great way to reduce the amount of money that you spend on your card. Try to use cash going forward. Also, opt for more affordable brands and always look for ways to save money.

Manage your spending well

Remember, your credit card is a tool to help you stretch your budget, not add pressure to it. Find ways to save money and use your credit card to assist you. You should also keep a close eye on your credit card balance and payments. It's easy to do this on your banking App or online banking.

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