3 Serious Credit Mistakes You Need to Avoid

As a mom, you’re the boss. You lay down the law, and you don’t make mistakes. At least, that’s what you like to think.

Sadly, few of us are totally perfect. You do your best to provide for your family, but some things can slip your attention.

Your credit score is one of those things. You could be doing harm to your rating without even knowing it and limiting your financial options in the future. If you want the best for your finances and your family, check in with this list to make sure you aren’t committing these credit mistakes.

  1. You don’t read your credit card statement

Between working your 9–5 and raising your kids, you don’t have a lot of time to spare — especially when it comes to things you’d rather not do, like paying bills. So you speed through these chores, scrolling down to the amount owing on your balance without looking at the rest of your statement.

Next billing cycle, you’ll want to check your statement in full. There’s a benefit to going over your statement line by line regardless of how busy you are. You’ll be able to catch errors on your statement as they happen and avoid paying for things you didn’t buy.

Whether it’s a billing error or fraud, you’ll be able to alert your credit card company and have these issues sorted right away.

  1. You pay only the minimum payment

When you’re running low on cash, the minimum payment is a convenient feature of credit cards. In a way, it lets you off the hook of a bigger bill until you’re in a better position to pay.

The real danger lies in relying on the minimum payment every month, even if you have the cash to spare. Although it lets you slip the full bill, you’re committing to pay interest on the remaining balance sometime in the future.

If that “sometime” is a long way away, you could rack up considerable interest charges, making it harder to pay down your debt. In fact, it could take decades before you could clear your balance.

MarketWatch crunched the numbers to see how long it will take you to pay off your credit card, use this minimum payment calculator. Once you see how long it takes to pay back even a small purchase, you’ll want to kick this habit.. If you owed $2,000 on a card with an 18 percent APR, and only made a $10 minimum payment each month, it would take 370 months to pay it off. By that time your kids will be all grown up and probably starting their own families!

  1. You don’t investigate lending alternatives

Bad credit happens. Sometimes it’s because you don’t know how credit works, so you make poor judgements about how and when you pay off loans or credit cards. Sometimes, it’s because a sudden loss of a job means you or your partner aren’t bringing in any money, so you can’t pay the family’s bills.

Once you learn about credit or get a new job, all you’ll want to do is put this behind you. Unfortunately, bad credit can hang around well past its welcome, making it hard to get financing from a mainstream bank.

You may write off personal loans altogether until you can establish enough good credit, but this isn’t always practical. In an emergency, you need cash to pay urgent bills or take on necessary repairs, regardless of your score.

Luckily, lending alternatives like installment loans and lines of credit are available. Some alternative lenders won’t focus on your score as much as traditional lenders. To see how these lenders operate click here for more information on getting installment loans with bad credit.

Accidents happen, and you can make mistakes. But these financial blunders shouldn’t hang over your family forever. Take the time to undo these credit faux-pas, and you’ll be able to fix what you’ve done to your score.