Credit cards can, and are intended to be, a great convenience to consumers.
In fact, in recent years they have become almost a necessity for those wishing to shop online, by mail or by phone.
Though credit cards make all of our lives easier there is no doubt that, if handled incorrectly, credit can quickly turn into a nightmare for the cardholder.
No one sets out to get themselves buried in debt.
However, there are some common pitfalls that, if not carefully avoided, can lead to and downward spiral of debt and a plummeting credit rating.
Being mindful of these potential pitfalls in the use of your credit now can save you a world of trouble later.
Impulse Shopping One of the biggest dangers associated with credit card use is the alluring impulse buy.
Impulse shopping is one of the leading causes of debt and access to our cards only makes the danger greater.
When using your credit card for those little incidentals it's easy to lose track of just how much you are spending.
Because they make impulse buys so much easier, it can be hard to budget your spending.
To avoid digging yourself into a hole, learn to monitor and control your impulse buys.
Saying "no" to that soda or trinket now can save yourself a mountain of debt.
Before any credit card purchase, ask yourself if the item is really necessary.
If it isn't, consider whether or not it is something you really want to pay interest on.
Cash Withdrawals Hand-in-hand with the problem of impulse shopping is the temptation to make cash withdrawals onyour credit card.
Being able to get cash with your card from an ATM is a great safety net when you find yourself short on an important purchase where credit isn't accepted, but it should be used sparingly, if at all.
The interest rate on cash withdrawals is often higher than even the normal rate for credit card purchases, and many cards do not offer an interest free period on these withdrawals.
ATM withdrawals are an expensive means of getting cash.
If you are making a withdrawal for an impulse or non-essential purchase you could end up paying a lot more than you bargained for.
Cash withdrawals are seldom worth what you'll end up paying for them and can be a potential factor in uncontrollable credit card debt.
Payments on Essentials Making bill payments or grocery shopping with your card can also create a slippery slope to overwhelming debt.
Using your credit card for these purchases can be very convenient if you have the funds to repay the purchases when you get your statement.
However, if you are using your card to make these payments and purchases because you are short on funds, then things can quickly get out of hand.
If you find yourself having to make essential purchases with your card, revaluate your budget and eliminate unnecessary purchases so you can avoid accruing debt.
Remember that your credit card is a convenience, not a backup plan for when things get tight.
Trying to solve a monetary problem now by using your credit can potentially create a bigger problem later.