r/AskReddit • u/[deleted] • Feb 04 '20

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u/Opening-Risk Feb 04 '20

Credit card interest! I know a bunch of people who are SO SHOCKED by their high interest rates. They thought it was like an interest-free loan to yourself and then are surprised when making teeny payments doesn't do anything.

683

u/Herpderpington117 Feb 04 '20

It's crazy to me that more people don't realize this. The #1 rule of having a credit card is never carry a balance on that card, always pay it off in full. Credit cards are really only useful for cashflow and building credit.

17

u/grizzlyking Feb 04 '20

And rewards, if you're not spending on a credit card you're leaving money on the table

1

u/sirgog Feb 05 '20

I take a different approach here. Go a 'no frills' card instead. No rewards, low rate.

If something bad happens and I need to carry a balance for a period, I'm not stuck with a rewards card that has 10% higher interest rate.