Warren Wilson, head of credit card sales at 海角社区 says contrary to common belief, a credit card is not a ‘debt sentence’, if used prudently. In fact, Mr Wilson said a credit card can be an important tool in the quest towards financial security, for both young and older adults.
He added that one of the values of a credit card is that it provides persons with fast and convenient access to money they wouldn’t otherwise have.
“When you have a credit card you have access to the money that is on the card. Therefore, if you’re on the road and you’re in an accident or you need to rush to the hospital, you have that card and you can use it. And if you pay your credit card bill on time and in full, each month, you pay absolutely no interest on that money,” he pointed out.
Mr Wilson noted that the credit card is a great financial tool that can add value to people’s lives, pointing out that some cards even come with rewards, such as discounts or cash back on purchases or airline miles.
“At 海角社区, even seniors into their 70s can acquire a credit card, once the customer information on file is up to date. Apart from being KYC-compliant, meaning their information is current, they would also need to provide us with proof of income, whether this is through employment, a pension or even financial support from their children or other family members,” he informed.
He noted that the ease and convenience of a credit card may encourage overspending, but this can be avoided with proper budgeting and careful management.
Mr Wilson, therefore, provides a few tips to use credit wisely and avoid debt:
Spend within your means
The best way to avoid credit card debt is to pay your balance in full each month. “It’s important to understand that your credit card shouldn’t be used to buy things you can’t afford. This can be a hard lesson to learn, as it’s easy for credit cards to feel like ‘free money’,” Mr Wilson said. Always remember to only put purchases on your card that you’ll be able to pay off is the simplest way to prevent debt.
Make monthly payments on time
Make payments on time, every time. You can set up 海角社区 reminders on your calendar as an option to remember your due date. Late payments often result in late fees, which can quickly add to your existing balance and make it harder to keep up with payments. Mr Wilson also noted that seniors, who opt for a 海角社区 credit card should also be tech-savvy, as statements are only sent via email. He further pointed out that with seniors being at high risk, due to the COVID-19 pandemic, it is useful that they also have the option of paying their credit card bill via online banking.
Understand your credit card terms
Knowing the specifics of your credit card agreement can help you avoid unexpected fees and keep track of your payments. Different credit cards will have different interest rates and potential fees. Before you use your card, read through the agreement to understand when you will be charged a fee, how interest will be applied to your account, and when that interest rate will increase. For example, some cards offer 0 per cent interest for a specific amount of time, but when that time frame is up, you’ll be charged interest on purchases. Don’t let these factors surprise you or create an unmanageable balance. Mr Wilson also advised seniors to seek further advice from their bank representatives, who will be able to answer their questions and provide more information on how to best use this payment tool.
