When you do unnecessary shopping. Avoid using a credit card or installment program for this. Why is that? This is because usually shopping or other consumptive activities are only used to satisfy themselves and not for needs. We recommend that you use a credit card and installment program to buy goods that are really needed. Like, cars, motorcycles, cell phones, and for urgent matters such as home renovations, operating costs and so on.
If shopping for goods such as clothes, bags, shoes and so on, you should not use a credit card. When you use a credit card for consumptive activities, you will be influenced to do this many times. The money you save can eventually be used up for unnecessary things. When you need it, instead you are forced to pay off installments that are not important.
Borrow according to ability
Many Indonesians have credit card limits that are far from income. Alias are greater than income. Ideally, the number of credit card loans or large installments do not exceed 35% of income. Never lie about income to get a higher credit card limit. This will motivate you to shop and buy goods. Preferably, credit cards are only used for items with a long useful life or sudden needs.
Borrow as needed
As has been said before. Avoid using a credit card or installment program to buy the items you want, not what you need. When you are not able to differentiate or manage your needs and desires, you will only be trapped in various financial problems. Though the ideal goal financially is to achieve financial independence. But as a result of not being able to resist the temptations of oneself or the desire to spend money, the opposite happened.
Don’t avoid the obligation to pay in installments
Another thing that can cause bad credit is avoiding the obligation to pay in installments. This problem usually starts from a moment of laziness to make installment payments. Delay payment time or use installment funds for other needs. If things like that continue, the ability to pay installments will decrease. Plus the installment interest continues to accumulate. This will certainly cause you to not be able to continue repayment payments and eventually there is bad credit.
Well, that’s 4 ways to avoid bad credit that Billie can give to you. Do not let this experience huh!
Have other tips? Simply write in the comments column!