Millennials, this is for you. Ok, maybe to anyone that needs help to avoid credit card debt.

Let's begin!

We Americans owe billions in credit card debt, and the bundled high-interest rates that come with it have to lead us to a challenging debt twist, which is definitely not easy to rise above.

As part of the Millennial generation, I myself have experienced a financial crisis. To a large extent, I also believe that our generation has gone through several economic downturns, which appear to be mostly for credit cards compared to other generations.

This makes it more important for our generation to know that credit cards can be harmful if used unwisely.

How to Avoid Credit Card Debt Today

So, if you're a Millennial, you can consider the following tips on using credit cards efficiently and avoiding any chance of getting into dangerous debt territory.

Never ignore interest rates.

Sometimes when you're experiencing financial pain, and you see an application for a new credit card in the mail, you may feel relieved.

But that feeling might turn out to be a big headache in the future if you apply without going through the terms first.

Not all credit cards are made equal, and some carry very high-interest rates that could become one of the reasons for your crippling financial situation.

About 15 percent as an annual percentage rate can be called a standard rate, but some are stretched as far as 20 percent.

So, make sure to go through the fine print on all cards and compare rates to discover the best card that fits your needs.

Also, don't get too captivated with low introductory rates. Keep in mind that all introductory rates eventually end up to be the exact opposite. If you're struggling your way out of debt, it may be a helpful option to transfer a balance to a card that has a 0% introductory APR.

But, be aware that these rates tend to jump after 90 days (as seen in most credit cards).

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Steer clear of fees

Some cards charge a yearly fee only to use them. In some cases, this fee allows the user to gain special benefits, but an average person never feels the need to give money to access the available credit.

It may feel like you've “arrived” simply because you are spending $500 per year for your platinum card, but it's an unnecessary expense if you use the card to pay for lunch and fill your car’s tank.

These high-quality credit cards consist of several perks and benefits that only benefit certain people.

Make a habit of paying on time.

The good thing about having credit cards is that if you keep paying off the balance regularly each month, you don’t need to pay any extra fees or interest.

If you think logically, there's really no disadvantage to making payments for items through a credit card and paying the monthly card bill in full.

Paying the bill in a timely fashion is counted to be the number one factor when it comes to determining credit history.

Miss a payment, and you are surrounded by late charges and a large amount of interest. Plus, you could see your credit score tumbling down the hill.

Keep an eye on the circling balance.

Your credit score could fall even if you pay the bill on time. But how? Well, if you carry a high monthly balance. Yes, credit bureaus aren’t fond of frequently seeing the creditors bumping up against the credit limit wall.

The fact is that one-third of your credit score stands on credit utilization or the debt amount you have vs. the credit amount that is available. In simple words, your aim should be to avoid gathering a hefty credit card bill, even if you're careful about timely payments.

Utilize for creating credit

If used responsibly, there is no better option to build a credit history than a credit card. This makes it much easier to borrow money elsewhere on favorable terms.

For instance, when applying for a mortgage, a lender will review your credit score status and payment history to fix the rate and the loan size you are entitled to.

With a short credit history, lenders may not get convinced to offer you good loan terms, or maybe you get turned down overall.

Use more than one card carefully.

Those with good credit scores have more than one card as compared to the ones who have lower scores.

Why? The reason is that your credit score is moderately based on the amount of debt you have compared to the overall credit availability.

Since more credit cards mean more accessible credit, there is a benefit to having multiple cards. The big caveat to this is that having more cards means having more chances to borrow and gather debt.

Having several cards offers flexibility, simply because not all cards are acknowledged in all places. Moreover, it may be supportive of different kinds of rewards from different cards.

There is no hard and fast rule regarding the number of credit cards that one should use, but you probably can get away with opting for two or maybe three.

Prepare a roadmap of your spending.

When it comes to using credit cards, it will help you maintain a real-time purchase record. If you are more of a cash person, keeping a record of your spending is more of a manual task.

Almost every company allows their card users to check their transactions online, and some even display purchases in their respective categories, thus, helping them with their financial planning.

When your credit card bill arrives, don't act hastily to pay it. Take your time to properly review what you spent in the last month and recognize the expenses that you can cut to boost your savings.

Make use of credit card rewards.

There's quite a fierce competition among credit card companies to provide the cardholders with rewards upon their purchases. Some offer cash back, whereas others offer travel points or other rewards.

Some cards offer cashback that can be used at expensive theme parks, and some allow you to divert money right into retirement accounts.

All in all, when you use your cards responsibly, they can prove to be a real difference in saving you a good amount of money.

Conduct some research to avail the cards that offer the best rewards by your requirements while keeping your distance from those cards that charge annual fees.

I hope these ways can prove to be beneficial to you. After all, our generation believes more in contributing to making our great country debt-free.

Good luck and stay positive, Millennials!

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