What are the Common Mistakes made by Credit Card Holders?

Credit cards are an extremely important financial tool. You should know how to use your credit card tactfully. Do not overuse your credit card, and be careful about it. Sometimes an individual does not use the credit cards correctly and gets stuck.

If you do not require the card, please do not use it. There are many cashback and natural ways wherein credit cards can be helpful. Credit card users should be aware of the Cashback facilities to use it at the right time.

Opting for the right credit card

If you want to have a credit card, you should know the terms and conditions of using the card. Also, make use of the credit card in the proper manner and build a good credit score for yourself.

Many people are unable to pay back the amount on their credit cards and further borrow christmas loans. This can be more damaging to their credit card rating. It is advisable not to borrow any more loans and use the card within limits.

Mistakes on your credit card

  • Taking out a credit card for the wrong reasons

Credit Cards can be taken out for various numbers of reasons. For example, they could be a big purchase or use it for school building tactics. This means that they should be thorough research involved behind it.

Also, be careful of the needs that the credit card can fulfil. Do not do it if you are taking out your credit card just because there is a promotion from the company side. Do not do it if you take all the credit cards just because of the cash checkpoints you are getting.

There should be a substantial reason behind the usage of your credit card. You have to pay back your credit card, which can be a big reason for not using it now and then.

  • Misunderstanding introductory offers

Many of the companies provide various introductory offers on credit cards. This is an excellent way to attract new customers. But these promotions are usually short term and may only apply to specific products.

For example, these promotional schemes will only be on the furniture or appliances, and you may not get skins on everything. While there is the introductory period, do not be carried away during that period.

Also, do not get stuck in a large mound that you cannot payback. Before buying any brand, always read the small print behind that product. Be aware and conscious before taking advantage of any introductory offer.

  • Maxing out the credit limit

By using a credit card, you can book on improving your credit score. Do not try to max out the credit limit on your credit card. That is the worst thing that you can do, making it harder to manage your finances.

Many people who try to max out the credit limit face financial issues and get penalized on the report. Try to maximize the limit by 50% and not more than that.

  • Withdrawing cash

Suppose you are withdrawing cash from your credit card. That is one of the worst things that you can do. Do not withdraw cash from your credit cards often, and there is a fee that is being charged on the withdrawal of money.

Withdrawing cash

The lenders charge hefty fees on the cash withdrawal. As soon as you make it, your fee is being charged on it. This charge will be visible to your future lenders as well, and it gives a very desperate picture of you if you are withdrawing money.

Hence, it says that you do not have enough money to spend. If you’re doing this on multiple occasions, you may have to struggle with the credit card score on your credit card. Also, there will be a bad image of you in front of the lenders.

  • Missing payments

Do not miss payments on the credit card. If you’re missing payments on the credit card, it can rapidly increase your debt and face on the card. Also, the interest in the car to be substantially damaged.

This ultimately leads to your credit score damage. There should be a balance between the missing payments and the balance left. This is one of the worst mistakes you can make if you use a credit card.

Regularly using your credit card should make you maintain a balance every month. This will help you build up your credit score; otherwise, it will build up debt.

  • Only making minimum payments

Many of you may be only making minimum payments for your credit card. Do not do that. Instead, define your payment every month and make proper payments that demonstrate good credit Card behaviour.

Many times, some users feel that if they make minimum payments, it will suffice the purpose of using a credit card.

At the same time, it is essential to make the payments in full. If the payments are not made in the right amount, the credit card benefits can backfire and may you lose your credit card.


Having a credit card may sound easy, but it is not easy at all. You should know the proper techniques while swiping your credit card and be aware of all the rules, terms and conditions while using it.

If you do not use it properly, it can pile up a debt every month, eventually leading to a damaged credit score.


Ana Adam is a content writer, blogger and financial advisor. She loves share her knowledge by blog and social networking platforms. In-spit of it, she believes to grab the knowledge from news media that inspire to write, and helps in entertaining.

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