Jakarta, CNBC Indonesia – Credit cards, a means of payment, are a valid choice if someone wants convenience in carrying out shopping transactions for daily necessities.
Apart from that, credit cards offer various benefits, such as attractive promotions and reward points that can reduce the total bill, among other things.
However, since the credit card payment mechanism allows one to “shop first, pay later,” there are several aspects worth noting. The following is the explanation.
Credit card use can be done correctly or incorrectly. If a credit card is used to shop for monthly necessities, pay insurance premiums, or other transactions that fit the budget, then this use can be considered appropriate.
However, is it worth using a credit card for cash withdrawals to pay off other debts? While this may be possible, keep in mind that it is not always wise.
In principle, credit cards can be used for various purposes, whether in accordance with norms or not. However, using a credit card for just one transaction actually increases the type of consumer debt.
This increase in debt will burden monthly cash flow and ultimately reduce wealth.
If it is necessary to use a credit card to take advantage of certain promos, it is recommended to pay off the payment immediately after the transaction is made.
People can have credit cards with limits that are higher than their income
Reporting from the Financial Services Authority (OJK) website, the minimum monthly income to have a credit card is IDR 3 million. Then for people with salaries between IDR 3 million and IDR 10 million, they are allowed to have two credit cards.
So what happens if the person concerned has a salary of IDR 10 million or more? It is stated that there are no special arrangements for card holders with income above IDR 10 million per month. These settings are returned to the card issuer to be adjusted risk appetite each.
Without realizing it, the consumer temptation for credit card holders is quite high. With its ease of use and large limits, there is a big possibility that credit card use will become overlimited, resulting in debt increasing and the value of wealth continuing to decline.
When someone is in credit card debt, assets can be lost because of the obligation to pay off this debt.
Do you like shopping with a credit card? Finances must be safe
Credit card holders must have a good mindset that this means of payment is not extra money. And they must also have good financial health, which is characterized by an ideal emergency fund and sufficient savings.
It is very important to anticipate what will happen if one day you lose your income and you are still obliged to pay the installments.
Without healthy finances, you may delay payments or apply for a loan to pay off the debt for digging holes and covering holes.
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