avoid credit card debtWhile a credit card can come with many rewards and perks, a worry that sometimes accompanies credit card ownership is the possibility of getting into debt. However, by being careful and employing certain financial tactics, you’ll be less likely to accumulate outstanding debts through your credit card usage. Here are some ways to help you avoid credit card debt.

Budget your money and credit card purchases

When you have a credit card, the temptation of being able to borrow credit to make purchases may be enticing, and it may become easy to accidentally borrow and spend more than you can afford. To avoid credit card debt, it’s better to just spend what you can pay back. In other words, don’t make a purchase unless you know you can pay it off. For example, you’ll want to use a credit card for things like your monthly bills or groceries, two things that you’ll be paying for anyway. By doing so, you’ll make sure that you won’t overspend and won’t be left with guilt later. It should be noted that the single exception to this rule is if you have a card with a 0% intro APR. Low APR cards allow you to avoid interest for a set period of time, which means it’s not costing you an arm and a leg to carry a balance on a low APR card. While you may not have to pay off the full amount right off the bat in this scenario, be sure to budget for your payments, so you’ll pay off the card before the 0% intro APR period expires.

The key to spending what you can afford is to create a budget. For starters, budgeting can allow you to track your spending habits, and you’ll have an easier time identifying non-essential purchases that you can do without. By removing these unnecessary expenses, you’re given the opportunity to save that money for areas that you need to spend in, such as taxes or your savings account. For more budgeting tips and tricks, read our guide to creating a budget that works.

Make on-time payments

To avoid credit card debt, it’s necessary to pay your credit card bills, and it’s best if you do so on time. Missing credit card payments can cause some serious consequences, such as late fees and penalty APRs, which will only increase your debt. By making on-time payments, you can ensure that your outstanding payments won’t pile up, and you can avoid penalty interest fees. If you need help remembering your credit cards’ due dates, note them in your calendar. Also, make sure you include the dates on your budget, as budgets are pointless if you don’t pay bills by their due dates. Additionally, set up payment reminders with your credit card issuer, as most offer such alerts via email or text.

If you can, pay balances in full

In a similar vein, to avoid credit card debt, you’ll want to pay off your balances in full every time a credit card bill comes along. Doing so will also completely prevent you from getting charged interest, depending on when you make the payment. As long as you make sure to budget for any purchases you plan to make with the card, you should have no problem paying it in full every month.

Those who are already in debt may not be able to pay their balances in full, but if they budget, they can determine what they can afford to pay each month to eliminate the debt. Since interest rates are on the rise, it may make sense for these individuals to complete a balance transfer, which means they transfer their debt to a card with a 0% intro APR period. Doing this will allow them to avoid paying interest on their debt so they can concentrate on paying it down. Need some help finding the best balance transfer card for you? Input your transfer balance, preferred monthly payment and your credit rating into our free Balance Transfer Calculator to see which card is right for you.

Know credit card’s terms inside and out

Another way to avoid credit card debt is to understand your credit card’s terms. By preparing yourself in this way, you can decrease your chances of being caught unaware if you do carry a balance for a month or so. Generally speaking, knowing your card’s terms and limitations could help you circumvent credit card debt.

When it comes to reviewing credit card terms, it’s important to note that credit card terms may be changed and updated. Because of this possibility, you may want to keep tabs on the terms, ensuring that you always have the latest news on them. Not sure what to look for? Our guide to reading credit card agreements spells it out for you.

Build an emergency fund

When certain unexpected situations, such as medical emergencies, arise, you may find an influx of large bills piling up on your plate. In these kinds of situations, if you don’t have enough money on hand to pay off these bills, it can be tempting to charge the fees to your credit card. Although some cards can help you avoid interest on these unexpected bills, it’s often not ideal to fund these with a credit card, as it can be easy to go into debt. Instead, to prevent yourself from finding yourself in this position, you can start a savings account for emergencies. If you were to have an emergency fund, you would be able to withdraw the needed money in times of need, helping you to avoid credit card debt in such situations.

Credit card debt is an unfortunate reality of credit, but if you use your credit card responsibly, you can easily avoid it. Follow our personal finance blog to learn more about managing your finances and credit cards.

Disclaimer: This content is not provided or commissioned by the credit card issuer. Opinions expressed here are author’s alone, not those of the credit card issuer, and have not been reviewed, approved or otherwise endorsed by the credit card issuer. This content was accurate at the time of this post, but card terms and conditions may change at any time. This site may be compensated through the credit card issuer Affiliate Program.