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Managing your finances for the year ahead

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By Victoria “NIKE” De Dios

Holiday shoppers and merrymakers usually indulge in shop-till-you-drop attitudes. After the holidays, the is the time when one realizes the financial burden.

All the festivities, gift-shopping, and reunions made for a busy season – one that lifted people’s spirits but may have drained their bank accounts. This is why it is important to get your finances in order as the year kicks off. 

According to Alex Ilagan, Executive Director of the Credit Card Association of the Philippines (CCAP), “Prioritizing your credit card expenses is a great first step in being financially responsible.”

“Every cardholder should be accountable for their finances no matter how big or small their debt is. Unsettled card balances can lead to issues in the future. They should be strategic in both using their card and dealing with debt, especially because it can help them make smart financial decisions all year round.”

Here are five tips from CCAP that can help you manage your card, especially after the holidays:

  1. Review all your due dates and create a timeline for payments

Before you settle your card’s balance, make sure you know what you’re paying for, how much you need to pay, and when you need to pay. Once you know all of this, allocate a part of your budget to pay your credit card. Setting reminders and creating a timeline for your payments can also be helpful, especially if you have multiple credit cards. Don’t miss out on your payment dates to avoid a penalty for paying late. 

  1. Check your accounts online via mobile applications 

Always check your transaction history to keep track of your spending and to monitor any suspicious activity. You can easily do these once you download your bank’s mobile app. These apps are here to create a more convenient banking experience for you as it speeds up checking of your balance, making transactions, and verifying your history. 

  1. Settle your debt as soon as possible

Don’t wait for due dates. Once you have money, be it from your salary or from other ventures, put aside what you can for the payments you have to make. You should also be strategic in allocating money, which means prioritizing more urgent payments first and avoiding unnecessary expenses that can add to your debt. As much as possible, try to pay your outstanding balances in full. This may be challenging, but it helps you avoid paying interests and manage your finances better in the long run. 

  1. Communicate with your banks

Banks can help you learn proper credit card usage and go about any debt you have. You shouldn’t be afraid to approach them for any questions or concerns regarding your credit card. For example, if paying your balance in full proves to be difficult, you can call your bank for balance transfers and debt consolidations. Depending on your situation, this allows you to pay the balance in installments and control the interest you’ll be paying. Always remember that your bank is there to offer assistance with your account.

  1. Don’t take debt lightly

A seemingly small debt can easily become something that you’ll have to pay off for weeks, months, or even years. Keep in mind that your credit card isn’t ‘free money,’ and make sure that you can pay back whatever you swipe your card for. 

These are just some tips to help you become a more responsible cardholder. As long as you manage your credit card, honor your financial commitments, and address debt properly, your holiday spending won’t create any problems in your finances. 

“Proper management of one’s debt is just one aspect of being an effective credit cardholder. CCAP believes that these tips are simple efforts that Filipinos can follow to help them spend right and keep their accounts in good standing,” Alex emphasized.

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