There are many myths about credit cards that either make people reluctant to get them or misuse them. Here are some common credit card myths:
- Myth: A credit card gives you free money. Fact: A credit card does not give you free money, you have to pay back the money that you use on your card. If you pay in full before the due date, you can avoid interest.
- Myth: A credit card will definitely put you in debt. Fact: A credit card will only put you in debt if you spend more than you can afford, or you don’t pay back your bill in full and on time.
- Myth: You will always pay interest on your card. Fact: That is not true. Once you pay the bill in its entirety by the due date, then you only pay for what you’ve spent!
- Myth: You must pay back the money if your card is scammed. Fact: This is not true. Once you’ve reported the incident to your bank and its investigations show that you were not at fault, you don’t have to worry about paying for something that you didn’t use.
- Myth: Paying the minimum balance on your card is enough…Fact: This is not so. You will never fully pay off your credit balance if you keep paying only the minimum balance, and while you are doing that you are incurring and paying a lot of money in interest payments.
- Myth: Having many credit cards will hurt your credit score. Fact: The number of credit cards you have does not significantly impact your credit score. What matters is how you use them. Responsible management and on-time payments can actually improve your credit score.