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How to budget with your credit card

25 July 2022Frankie Jones 3 min read
A person looks at their credit card, while holding their phone.

Looking for better credit card benefits?

You can compare the different benefits of several credit cards on ClearScore.

See my card offers

A credit card allows you to make purchases and pay back the debt in monthly instalments. If this isn’t a service you’re looking for, it may seem strange to use your credit card. However, there are additional benefits to doing so, such as improving your credit score.

With this in mind, you need plan how to manage your credit cards alongside your usual budget. If you lose track of these credit payments, they will add up and you could become responsible for a hefty sum of debt.

We highlight four ways to manage your credit card spending that will ensure it benefits your personal finances.

In South Africa, many cards offer interest-free periods, which usually last for 55 days. This means that you can purchase an item on your credit card and, if you settle your account within 55 days, you won’t have to pay any interest on it.

By tracking your interest-free periods, you will be able to repay your accounts before they’re charged any interest. This will reduce your monthly costs, and it may be another way to ensure you have enough money left over to save without giving up your daily latte.

Alongside your usual budget, you can make a note of your interest-free periods to help you keep track of them. You can also set alarms on your phone to remind you when your interest-free periods come to a close, add them to your day-to-day calendar, or even set up a debit order.

If you’d like to find a credit card with a longer interest-free period, you can log in to ClearScore to see which credit cards you may be eligible for.

When you apply for a credit card, your lender will give you a credit limit based on your credit profile. For example, if you have a great credit score and you do well with the affordability test, then you will receive a higher credit limit.

However, this doesn’t mean you should max out your credit limit each month. In fact, your credit score may decline if you spend 100% of the credit that’s available to you – even if you’re capable of paying it back. Ideally, you should try to keep your credit utilisation around 30%.

To help maintain this number, write down how much you’re allowed to spend on each account and then work out how much 30% is. For example, if you have a credit limit of R3,000, then you can set your own limit of R900 to ensure your credit score grows – and your debt remains manageable.

Do you know your current credit limits? Login to view this on ClearScore. You can also select an account to find out more about its payment history.

It’s best to restrict the number of credit cards you have. If you’re unsure about the terms of each of your credit agreements, then it might be time to reduce the number of open accounts you have. It’s possible to cancel an old credit card without affecting your credit score – read more about it here.

If you prefer a single credit card, it will simplify your monthly expenses and you will be able to check all your transactions in one place. However, if you decide to hang on to more than one credit card, you could use this as an additional budgeting opportunity. For example, you can use one card for groceries and another for major expenses.

Are you looking for a credit card to help you budget? Log in to ClearScore to find a credit card that suits your needs.

Your credit score is a great indication of whether you’re successfully managing your credit cards. You should, therefore, keep a close eye on how your credit score is performing. If your credit score is doing exceptionally well, then you’re managing your credit cards effectively.

On ClearScore, you can see whether you’ve paid each of your accounts on time, and you can find out whether you’re sticking to your chosen credit limits.

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Written by Frankie Jones


Frankie takes the often confusing world of finance and makes it clear and simple, to help you get your money sorted.