Credit habits can drag down your credit score, deteriorate your financial future and keep you in debt. It can have a negative effect on your entire life. It is easy to fall into bad habits and they can wreak havoc on your credit score. One single impulse purchase can bring about a reckless pattern of spending. So, consider your credit habits and if you find anything wrong then replace it with a better habit right away. Here we have put together some of the bad credit habits that you should stop right away.  

Paying Only The Minimum

If you are paying only the minimum due, you will never be able to get out of debt. Besides, high balances can also mess up your credit score. Another factor influencing your credit score is how much of your available credit is being used. To break this habit avoid paying minimum and pay as much as you can on your bills until you reach zero. You may have to make some sacrifices to secure extra funds to put towards your goal

Missing Payments

You may things that missing one payment here and there isn’t a big deal. But being careless about the deadline of your bills can hurt you. Payment history and negative payment information can cause the most serious drop in your credit score. The best way to deal with it is to set your payments. Automatic monthly deduction will cover you if in case you lose track of the calendar. Just ensure you have the available funds in your checking account.

Choosing Luxury Over Saving

If you are keen on enjoy your life and least interest in maintaining a budget or track spending, you will always be behind on your finances. Instead, start budgeting and start by keeping a track of your spending for 30 days. You can either use an app or use spreadsheet. When you note down everything you will get to know actually how much you are spending on food, entertainment, and leisure. Review it to determine where you are overspending and identify ways to lower expenses.

Not Keeping A Track Of Your Credit Reports

You cannot correct your bad credit habits until and unless you have a clear picture of where you stand. There may be errors in your credit report or you could be a victim of identity theft and all these could be dragging down your credit score. Thus, it is important that you collect your free credit report every year from all three credit bureaus and go through them carefully. If you spot any error, report about it immediately.

Having Too Many Credit Cards

Stop applying for new credit cards without any purpose or plan. Besides, having too many credit cards indicates that you are an impulse credit applicant. Besides, making too many inquiries within a short span might be a red flag. So, be selective when opening new cards and choose one that matches your spending style and financial situation.

Not Reading The Credit Card Statements

You may receive various mails every month which you may ignore and never read them. But you should never miss to go through your credit card statement to check unauthorized credit card charges or billing errors. Do not just read your credit card statement to check your balance and payment information. Make sure you carefully review the entire statement and verify all your account activity.

Making Purchases With Credit Card And Never Checking Credit Limit

Avoid using your credit card over your debit card unless you pay off your credit card balance timely every month. You should also keep a regular check on your credit card balance as there are chances that you may have forgotten about some purchases and your credit limit was lowered. Whenever you are using your credit card, you should have a concrete plan for how you will be repaying back.