Credit Card: A Friend in Need or A Foe Indeed?

We used to go everywhere together, my friend and I; movies, shopping, dining and even holidays. I loved being around her; she made me feel complete. When I was short on cash, she offered help. Then she betrayed me - who is she? My credit card

Credit card dos and don’ts

Let me tell you about this one friend I used to have. We used to go everywhere together; movies, shopping, dining and even holidays. I loved being around her; she made me feel complete.

When I was short on cash, she was quick to offer help. Sometimes I refused, but most of the time I gave in. Over the years, my debt accumulated. I couldn’t afford to pay a lot every month, so when I learnt about the minimum amount I could pay to her every month, I was overjoyed. What a true friend she was - my credit card!

But my happiness was short-lived. I started to notice that my debt kept increasing despite the monthly payment. I felt that she was not completely honest with me. So I asked friends who know her best. They confirmed my suspicion; she was hiding things from me. From that moment, I started to look deeper into my relationship with her.

If I were to describe the relationship I had when I first got my credit card, the above description would fit perfectly. I have to admit, I was naive. So take my advice and don’t make the same credit card mistakes as me.


  • Think carefully before you sign up for credit card facility. Do you really need one? What is your main purpose for having a credit card?
  • Browse around for the best credit card for YOU, not others, but you. Not all credit cards are the same.
  • Read the fine print thoroughly. If there is anything in there that you don’t understand; ask.
  • Check your credit card statement and notify the bank immediately of any unusual activity or unauthorised charges.
  • Pay your credit card balance in full every month. If you find this hard to do, at least pay more than the minimum amount.
  • Check the security of an online store when you do your shopping online.
  • Take advantage of promotions or rewards such as cash rebates and discounts on dining, travel or shopping. However, always make sure that you can afford to pay back in full every time.


  • Be too dependent on your credit card. If you use your credit card to buy things you can’t afford without it then you need to think carefully.
  • Be late with payment. Typically the bank will charge you 1% when you make late payments. That is about RM20 if you have RM2000 balance on your credit card. It may not be a lot, but if you keep paying late, say for 6 months, it would reach RM120 (assuming the balance amount is the same). Late payments also will also reflect badly on your credit rating.
  • Give away your personal information such as pin numbers or security number (the 3 last digits at the back of your credit card). Be wary of people who ask you for these information; it is highly likely that they are illegitimate.
  • Take cash advances. The interest rate for a cash advance is much higher. If you’re already accumulating debts on your credit card account, this will only make it worse.    

Think about how you use yours. The first word describes it best, it is a CREDIT card. Treat it as one.

Image: CambridgeLifeSolutions


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