New Year’s Resolution to Pay Down Debt? This May Help
Looking towards 2016, paying down debt is the top priority for Canadians in the new year, according to a recent poll. The poll showed that 26% of respondents named debt reduction as their key financial goal for 2016, no suprise after the downturn year Canada saw this year.
Debt and credit are closely tied. For many people, their debts come in the form of credit products. Your credit is a very powerful tool for your financial future, and it’s especially important when it comes time to purchase a home. Whether you’re a first-time homebuyer or seasoned investor, here’s how to handle your credit with care.
- Understand credit: understand what makes up your credit score and what will affect it. Here’s a free guide on understanding your credit.
- Don’t rush into credit cards: don’t start with multiple credit cards, start with one (with a low limit) and master the management, then move onto two.
- Shop around: shop around for the best credit card rates and deals, and never be afraid to ask for advice when it comes to your finances.
- Read the fine print: always read your credit card agreements closely, and make sure you understand it before you sign.
- Keep cards paid off: try to pay off your credit card balance each month, not just the minimum payment.
- Pay your payments on time: just one late payment can affect your credit in a negative way, and will also raise your interest rate in the future.
- Budget: simple advice, but set a budget and make sure you stick to it.
- Update accounts: make sure your credit card companies are always kept aware of any changes in your address, etc.
- Be proactive: if you know a payment will be late, call your credit card company right away and setup a payment schedule. In most cases, being proactive won’t hurt you, and most companies are willing to work with you.
- Control spending: at the first sign of overspending on your card(s), stop using them. If you really can’t control yourself, give your credit cards to a friend for safekeeping until you get them under control again.
To learn more about credit card smarts and information you need to know, here’s my free guide: 11 Credit Card Secrets. As always, feel free to contact me anytime, or tweet me.
