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AnnaMarie Houlis is a contributor to Forbes Advisor. She’s a nomadic journalist and adventure aficionado who spent several years cultivating her editorial career in New York City before venturing off to freelance from around the world. She’s traveled nearly 80 countries while writing about travel and finance, as well as health and social issues, for internationally acclaimed magazines online and in print.
AnnaMarie Houlis is a contributor to Forbes Advisor. She’s a nomadic journalist and adventure aficionado who spent several years cultivating her editorial career in New York City before venturing off to freelance from around the world. She’s traveled nearly 80 countries while writing about travel and finance, as well as health and social issues, for internationally acclaimed magazines online and in print.
Over a decade of editorial experience across a number of publications and more than 60 countries visited have given Dylan Pearl a wealth of travel knowledge, and the tools to effectively communicate that knowledge to others. Dylan has made it his mission to see as much of the world as possible, and strives to give everyone the tools to get out and do the same with simple, actionable information.
Over a decade of editorial experience across a number of publications and more than 60 countries visited have given Dylan Pearl a wealth of travel knowledge, and the tools to effectively communicate that knowledge to others. Dylan has made it his mission to see as much of the world as possible, and strives to give everyone the tools to get out and do the same with simple, actionable information.
Editorial Note: We earn a commission from partner links on Forbes Advisor. Commissions do not affect our editors’ opinions or evaluations.
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Save money. Pay down debt. Raise that credit score. New year, new you, right?
All of that is easier said than done. It’s not as simple as waving a sparkling firecracker like a magic wand at your finances to ring in the new year. But we can all be more mindful of unhealthy habits we may have fallen into over time and strive to build wiser ones.
To get you started, here are six detrimental credit card habits to break this year along with smarter alternatives to embrace for a financially empowered 2024.
Find the Best Credit Cards for 2024
No single credit card is the best option for every family, every purchase or every budget. We’ve picked the best credit cards in a way designed to be the most helpful to the widest variety of readers.
1. Making Only the Minimum Payments
Choosing the minimum payment option on your credit card monthly bill may seem convenient and budget-friendly on the surface. But it will cause you to accrue interest on your balance, unless you’re currently within a 0% intro APR period. And since credit cards are a high-interest form of debt, making smaller payments today could leave you with a much bigger debt burden down the road.
Smarter alternative: Paying more than the minimum reduces your overall interest, which speeds up the repayment process and contributes to long-term financial health. While there may be months that the minimum payment is all you can afford, you should always pay more (if not all) of your statement balance when you can.
2. Missing Payments
It doesn’t always happen on purpose. We’re all only human. But missing your credit card due date racks up late fees and takes a toll on your credit score, especially if it happens regularly.
Smarter alternative: Features like autopay can combat forgetfulness and help ensure timely payments, providing you with peace of mind. Most credit cards allow you to pick your own autopay due date as well, which means you can pick a day that comes soon after a regular payday if you’d like.
3. Maxing Out Your Credit Limit
Just because you may have a hefty credit limit doesn’t mean you should use every dollar of it. Pushing your credit limit raises your credit utilization ratio, which can ultimately hurt your credit score. Your credit utilization ratio refers to the amount of credit you use (expressed as a percentage) out of the existing line of credit you have. For example, if you have a card with a $10,000 limit and you put $6,000 on the card, your credit utilization would be 60%.
Smarter alternative: Aim to keep your credit utilization below 30%, which is the percentage that experts advise will provide the best credit scoring results
4. Neglecting Your Statements
Many of us are inundated with daily spam mail, both in our email inboxes as well as our physical mailboxes, that we immediately delete or throw away. But amidst all the communication clutter, your monthly credit card statement is one email or letter that you don’t want to leave unopened. Failing to check your statements leaves you vulnerable to missing unauthorized charges or even identity theft.
Smarter alternative: Regularly review your statements to detect any discrepancies should they arise. If you notice any unauthorized charges, duplicate charges or suspicious behavior, move quickly to address them with your credit card support team. Setting up alerts for suspicious or duplicate charges can also be helpful.
5. Picking the Wrong Rewards Card
Not all rewards credit cards are created equal. Some are better than others, especially for specific expenses like travel, dining or gas. Choosing a card that offers its best rewards on expenses that don’t match your spending patterns reduces your earnings potential.
Smarter alternative: Determine the categories where you spend the most. Then check to see if your existing cards earn bonus rewards for those categories. If not, you may want to consider a different card that does. Whatever card you choose, familiarize yourself with its full benefits package so you don’t miss out on valuable extras like statement credits, lounge access or travel and consumer protections.
Find the Best Rewards Credit Cards of 2024
6. Opening (And Closing) Too Many Credit Cards
Most issuers have rules regarding how many cards you can apply for over certain periods of time. So applying for too many today could mean that you aren’t able to take advantage of an outstanding limited-timed welcome bonus offer a few months from now. Also, indiscriminately applying for cards and closing old accounts could have negative effects on your credit score.
Smarter alternative: Being intentional about the cards for which you apply and then maintaining them can help preserve your credit score while also giving you the flexibility to pounce on great welcome bonus opportunities when they pop up.
Bottom Line
Breaking free from poor credit card habits in 2024 and adopting smarter strategies sets the stage for a more stable financial future. Putting healthy credit card habits into practice can help you reduce debt, build a strong credit history and make the most of your card’s benefits.
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