Credit cards are a good payment optionas long as you are aware that the authorized credit is a loan that you must pay and the main thing is to avoid only the minimum payment because this means a higher interest percentage and that it will take years to pay off that debt.
The above comes up because Buen Fin 2024 is approaching, the weekend where Mexicans get carried away by the intoxication of the moment, by promotions and by interest-free months.
According to Gianco Abundiz, personal finance specialist, speaker and influencer, in interview with advertising meter, explained that there are three basic conditions for using credit cards:
- The first and fundamental thing is to consider that it is borrowed money that you must pay and the sooner the better.
- It must be remembered that this financial instrument is not nominative, because you do not actually feel every expense you make.
- There must be a fundamental rule regarding the line of credit: This is what you earn, you must have a maximum of four times in cards, no more, so that you can have a debt of 20% of your income.
In the opinion of the specialist, the credit card is a revolving creditwhich means that if you earn 10 thousand pesos per month and have a line of credit of 40 thousand pesos and you use 18 thousand pesos, but you pay them in the short term, they will give you the available 40 thousand pesos again.
“The credit card should be used based on specific needs, your preferred card should be turned off and kept in the drawer, because fever, emotion, lead you to make unplanned purchases, you should only turn it on when you have a scheduled expense,” he said.
Totaleros or minimum payment: your peace of mind depends on it
Asked about how credit card payments should be made, he responded:
“The ideal is to be total, that is, pay the total debt incurred, but if you cannot be total, for some reason, try to pay the purchase within a period that does not exceed six months, and stop all types of expenses, since if you use the card credit to treat yourself, you will pay more for these treats, and it is not about giving money away by paying interest,” he explained.
He indicated that There are people who ‘give it up’ with their credit card and by having a spending pattern that becomes chronic and disorganized, what they should do is restructure their credit.
Regarding people who pay the minimum for their card, he warned that it is like having a chronic degenerative diseasebecause it will take many years to pay off the amount of your debt.
“These types of people must approach the bank or the institution that gave them the credit to restructure their payments and request a fixed payment scheme in two or three years, but you already know that you are going to pay this amount in a certain time” , accurate.
One last recommendation about interest-free months
The specialist finally launched a final recommendation for all readers, regarding the months without interest to know if they are real or invented:
“How do you know if the interest-free months are real or an invention of the business that offers you the product? If the cash price is the same as the months, then the offer is real, if the cash price is less than the supposed months-long promotion, if they are charging you disguised interest, and this must be taken into account because there is a lot of deception in supposed promotions,” he concluded.
