Usually, many individuals find credit card to be a burden due to varied reasons. They are always on a lookout for a credit card substitute. While some solutions may seem to be useful, others can not only hurt your credit, but also put you further in debt.
To find out the best substitute for credit cards, first you must understand the reasons why the credit cards aren’t acceptable by some of its users.
Some prime reasons include –
- The debt amount may be huge. If the card owner keeps on purchasing using the credit card and is unable to repay the amount on monthly basis, then gradually it will lead to huge interest fees adding to the outstanding balance. The person will land in grave debt, unable to pay even minimum balance monthly.
- Chances of defaulting are more. The reward points and other benefits can be availed by paying high interest rate. if the user of the card isn’t able to pay all the borrowed money with interest or misses out on EMIs will become a defaulter.
- Leads to bad credit scores. Keeping your credit below the limit is quite essential to enhance your credit score. While availing any kind of loan, less credit score will surely affect sanctioning of money by any authorised financial companies.
The reasons for not preferring to use credit card for everyone may vary from person to person. However, all would like to use other modes of payment, which are more beneficial when compared to the credit cards. Reputed financial lenders and advisors like Loanpig.Co.Uk help people learn more about the other ways that are equally beneficial like credit cards without any worries about succumbing to debt.
Here are few ways suggested by well-known financial advisors:
- Use debit card – It really helps as you won’t be tempted to spend more than you can afford. While using debit card you can avail for the shower of discounts and rewards offered by online marketers as well as the provider of the debit card.
- Can pay by pre-payment credit card – It is easier to manage than credit card as you load limited amount of credit in it to be used till it runs out. As the total amount of credit is less, the interest rate is nominal. Thus, the user doesn’t have the stress to pay huge interest and taxi fees.
- Pay by cash – The age-old way to pay for the commodities bought is by cash. It won’t help you to be tempted like credit card does and moreover you are feeling satisfied of not paying any extra charges at the end of the month as interest charges.
Usage of credit cards isn’t always a disadvantage if you are well planned, try to do budget friendly shopping and use the cards while you are confident to pay all the money back in few days. Organising your financial data will be right to do. Moreover, you need to use the credit cards while rewards and discount offers are announced to save your hard-earned money.