3 Credit Card Mistakes to Avoid

Last Update: September 7, 2021 Credit Cards

With American credit card debt continuing to rise – surpassing the highs we saw during the 2008 financial crisis – more citizens rely on debt to finance their lifestyle. Moreover, data from the Consumer Financial Protection Bureau (CFPB) implies that 71% of credit card accounts roll over each month and incur interest charges.

And as the cycle continues, your finances become worse-off.

So, before you use your credit card to make your next purchase, consider whether you’re making one of these 3 mistakes.

Not Tracking Your Spending

Regardless of income, everyone needs to spend within their means. But, if you don’t track your credit card spending, how will you know whether or not you’re staying within your budget? When you don’t pay attention to where your money is going, you’re more likely to rack up a balance that you can’t pay off when the bill comes due.

Think of yourself as a business.

Your revenue should always outpace your expenses. If you’re spending beyond your after-tax income, how long can you keep that up? Carrying a positive credit card balance every month will have a devastating effect on your financial health. Remember, the average credit card interest rate for accounts assessed interest is 17.14%. And many credit cards have APRs of 28% or more. The longer you carry a positive balance, the more these charges add up.

Making Impulse Purchases

Maybe it’s a new pair of shoes. Or maybe it’s the latest smartphone. Whatever the temptation, credit cards are an easy way to finance items you really can’t afford. So before pulling the trigger, implement a 1-Day Rule: The next time you come across an item you really want, let it go and move on with your day. When you wake up the next morning, ask yourself if you still want the item. You’ll likely realize that it’s not that important to you, and you actually don’t need it.

Remember, the best practice is to use your credit card balance for items you truly need.


Often, people use shopping as a way to pass the time. Going to the mall can provide something to do on a Saturday afternoon, and browsing online can kill a few hours when you’re stuck in the house. The problem is, using shopping as a cure for boredom is an expensive remedy.

To curb the problem, set aside a certain amount each month for frivolous spending. Better yet, it would help if you considered less costly hobbies. Try going for a bike ride or taking a walk with friends. Take up gardening or learn to play tennis. In the winter, you can try learning a new language or how to play an instrument. Or what about taking an educational course online to increase your attractiveness in the job market? At Udemy, there are thousands of affordable courses, each offering lifetime access. And not only will they keep your mind occupied and help you save more money, but the skills you learn will allow you to earn a higher salary as well.



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