Being in the business of comparing financial products, we know all about using credit cards responsibly. Here are the SingSaver.com.sg team’s best secrets to managing them well.
As a financial products comparison business in Singapore, we pride ourselves on being extremely well-versed in all things credit cards — and that includes managing them well.
The line between making the most out of your credit card and accumulating debt can be so blurred that you end up crossing from one side to the other before you know it. And yes, we’ve been there ourselves. But we’ve since learnt how to be a lot more responsible with our credit cards.
Here are some of our favourite tricks that we use (and lessons learnt) to avoid paying credit card interests or late fees:
“Don’t take cash advances from your credit card.”
Cash advances from your credit card have an exorbitantly high interest rate with no grace period. Our Managing Director and money saving expert, Rohith Murthy, urges cardholders to never withdraw money from your credit card because you’ll get charged an interest rate of 24% to 28% on that amount. If you’re in need of a cold, hard cash loan, you might want to consider taking out a credit line instead.
“Lower your credit limit.”
Ryan Ong, our superstar finance writer who has been doing this for over a decade now, suggests that lowering your credit limit below your income level can help you reduce your spending. So if you’re earning S$5,000 monthly, set your credit limit to S$4,999 or less instead of letting the bank give you their usual credit limit of up to two times your salary.
“Make all your monthly purchases on your credit card.”
By charging on more than one card–be it debit or credit–can complicate the tracking of your spending. So Diana Seredenciuc, who has been working in finance for eight years and is our Business Development Manager, keeps her charges to her only credit card. Not only is tracking easier for her, she also finds it much easier to pay her bills off monthly.
“Download the bank’s app to check your spend.”
For all you tech-savvy millennials out there, you can check your credit card spending on-the-go with the bank’s app. Weiqi, a fellow millennial and our Business Analyst wizard, has downloaded DBS and American Express apps on her iPhone. You’ll be able to track, pay and redeem your rewards all from your mobile phone. Forget queuing at an AXS machine to pay your credit card bills!
“Pay for your purchase immediately.”
Our Content Manager, Lauren Dado, likes paying off purchases on her credit card through her internet banking account within 24 hours to avoid incurring debt or late fees. The moment you make a charge on your credit card, log on to your internet or mobile banking account to transfer the amount spent to your credit card account. It might not reflect as payment immediately, but will show up later when your monthly bill arrives.
“Set up a Giro service to pay off your credit card bills.”
Alternatively, you might want to use a Giro service to pay for your cards. Weiqi set up a Giro service for each of her credit cards so she never misses a payment date. It isalso an extremely convenient way to pay since it’s automated, especially if you’re forgetful or lazy.
“Never store your credit card details on your laptop or phone.”
Identity theft is a real issue, but one that most people think would never happen to them. Ryan was on a holiday when his phone was stolen, and with it, his credit card details and other confidential information. His entire day was spent calling banks and other services to report theft. He also encourages for cardholders to never save their credit card details on their laptops because you’re putting yourself at risk if you’re ever going to get hacked.
You can use SingSaver.com.sg’s free comparison tools to find the best credit cards in Singapore.
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By Jehanne Teo
Starting out as a lifestyle writer, Jehanne currently writes for SingSaver.com.sg about saving money in everyday situations.