With the ongoing coronavirus crisis, most of the businesses are shut down and a lot of people are dealing with financial hardship because of loss of income. In times like these, it becomes critically important to manage your finances on all aspects including your credit card payments. So, if you’re struggling to afford your credit card bills or finding it difficult to manage your credit card payments, here is how you can manage your credit card efficiently during the COVID-19 pandemic.
1. Plan your budget
With a credit card in hand, you can get carried away easily even when you’re confined to home! You may have saved a lot on dining out, theatres, and travel but now you are in a position where you would spend more on online foods, groceries, and streaming services. So, start planning your budget at the start of the week or month and try cutting all the credit card expenses that you feel are unnecessary at the moment.
2. Make manual payments
Most of us set our credit card payments to the ‘autopay’ option for the convenience of avoiding late fees, but this eventually lowers your checking account balance. Considering the current scenario, it would be a wise decision to turn off the ‘autopay’ option or any scheduled credit card auto payments. The best way is to make manual payments from now on or you can just set your autopay to pay a minimum amount and pay more manually if your budget allows. This way you can avoid potential overdraft fees.
3. Avail the moratorium on credit card dues.
If you are a credit card owner facing difficulty in managing your credit card payments, you can avail of the moratorium on credit card dues. This will save you from incurring any late payment fees and makes sure that you don’t land in a debt trap. Since any unpaid outstanding credit card bills will continue to accumulate hefty charges, missing your credit card due date will only put you in more debt. So, always try to repay your credit card bills in full amount before the due date, and if you know that you can’t repay your credit card dues, try availing the moratorium on credit card dues.
4. Try limiting your cash withdrawal using credit card
Withdrawing cash through a credit card can place two more heavy financial loads on your wallet- You will be charged a cash advance fee as high as 3.5% of the withdrawn amount and you will be charged a finance fee starting from the withdrawal until the day of repayment. Now imagine withdrawing cash using your credit card, twice a week for a month. It can easily consume a large part of your hard-earned money. So, try limiting your cash withdrawal using a credit card.
5. Reach out for help
You can always ask for help you need it. From deferred payments and waived fees to extensions, credit card issuers are offering their help during this COVID-19 pandemic. But you need to approach and reach out to your credit card issuer and ask for help. There is no guarantee that the credit card issuers would grant you waived fees or extensions but there is no harm in seeking help and most of the time, they would be happy to help you.
Credit cards can be of great help during uncertain times like these when we have a little or no cash in hand. However, even small financial mistakes we make with our credit card can put us in a really hard financial situation. So, keep these points in mind to manage your credit card payments efficiently during COVID-19 pandemic and steer clear of debts.