It’s very easy to get into a debt trap when you use your credit card recklessly. But using a credit card wisely has its advantages and is useful in specific conditions. It can be a source of strength for your financial needs if you use it smartly. Considering this, several tips to avoid credit card debt become powerful tools to make the best use of credit cards.

Being aware of these tips and putting them to practice saves you the time, energy and of course, the money.

Assess your finances
Evaluating your finances is the first step to ensure minimum or totally avoid credit card debts. Make a list of all the debts you owe, including monthly bills and credit card payments. Review the annual percentage rate and tackle each card and expense is a methodological way. See if it’s better to pay off the higher-interest debt first or the lower-balance cards first.

Prioritize your spending
Make a proper list of your spending habits and prioritize them based on their importance. For example, basic expenses like food, clothing, and housing take the topmost priority. Next, make sure to pay off at least the minimum amount on secured debts. Follow it up by paying off your credit card debt. Evaluate your monthly payment capacity and the desired timeframe and stick to the task. Also, don’t forget the student loan debt if you have one. Defaulting on student loan debt has serious consequences on your finances. You can lose your wages, tax refunds, and social security benefits. Always pay your debts using either cash or a debit card. Paying off your debt using a credit card again accumulates debt that can be frustrating.

Consider peer-to-peer lenders
One of the useful tips to avoid credit card debt is to borrow money from peer-to-peer lender sites. Sites like Lending Club and Prosper are fully secured lending sites with comprehensive facilities to tackle credit card debts. They offer loans with interest rates lower by up to 30% of credit card rates. You can save big bucks in the process. A secured job and a good credit score qualify you to acquire a higher loan amount online.

Consider making two minimum payments every month
Interest on credit cards is charged on a daily basis, and the later you pay, the more you end up paying. If you are on a tight budget, make the minimum payment at the earliest. Continue this two-time minimum payment option until you pay off the debt fully. This technique will make you debt-free much quicker than you imagine.

Convert your payments to EMIs
It’s yet another effective method among the tips to avoid credit card debt. Certain times, the total outstanding debt can be overwhelming. It is a wise option to convert the outstanding amount into monthly EMIs. Though banks charge a processing fee and a nominal monthly interest for the EMI facility, it’s significantly lower than accumulating credit card interest. You can make arrangements for other financial matters without worrying.