Do’s and don’ts of credit card usage

A stock image of a card transaction.

DON’T fool yourself; a personal credit card equals debt.

“When you use a credit card, it feels so easy and it’s so much fun, until you get hit by a confused reality – your debt spiralling out of control,” said Wikus Olivier, debt management expert at DebtSafe.

Olivier highlights that you need to ask yourself an important question: Why do you actually want to use a credit card? A few swipes of this underestimated weapon can leave you confused on how you’ve managed to get your finances stuck in the red. And why you have even considered using it in the first place.

Olivier said that if you currently own a credit card and have answered the question why you need one, there are a few dos and don’ts that will help you to manage your ‘swipes’ and limit the amount of debt that you accumulate.


1. Proper financial planning is everything and is therefore an essential and strategic process that will guide you along the way. If you use your credit card, do proper planning beforehand, to know exactly what the minimum payment is that you need to pay back.
2. Use your credit card responsibly by keeping up with your payments. This will improve and help your credit score. One missed payment can have a negative impact on your credit score.
3. If you want to use your credit card for the loyalty benefits, use it like a debit card. Do not allow it to fall into credit, but maintain a positive balance. You’ll even earn some interest on a positive balance.
4. Try to pay more than your minimum payment each month, to ensure you don’t only cover the ‘rent’ of what you owe. This will help to create a good credit rating.


1. Relying too much on your credit card shows a lack of financial planning and can negatively impact your ability to access other credit such as home loans or vehicle financing.
2. Although a credit card gets you excited because of the loyalty rewards / points that come your way, compare it to your financial stability. Is the cost (done by unnecessary and excessive spending) really worth flushing your finances down the drain? A good and healthy bank account means more than how much loyalty rewards you accumulate. It is nothing else than an incentive scheme from the banks to get you to spend more on your credit card so they can earn interest on your debt.
3. Don’t miss or skip a payment – there are extra fees involved, and your credit score can take a knock.
4. Do not exceed your credit limit / max it out, as you’ll need to pay a penalty fee. Once a credit card is maxed out, it is very difficult to get the balance down. It will take months’ effort to get your credit card balance down to zero.

Remember, a credit card is ‘expensive’ debt. And if you neglect proper and proactive financial planning that goes hand in hand with it, it can cause major confusion.



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Khethukuthula Lembethe-Xulu

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