Spring cleaning? Refresh your credit card know-how too!


Welcome Spring! We're all celebrating a season of renewal and, as warmer days return, we're dusting off the cobwebs and sprucing up our homes. The 'New You' will also make time to check in on your financial fitness - and particularly refreshing your understanding of how to make your credit card work for you.

"Spring offers the perfect chance to evaluate your life and revive on every level - including my favourite area of focus - becoming more savvy about your personal finances," says Phuti Sebidi, Chief Customer Officer at Discovery Card. "One key strategy in maximising your financial fitness is to use your credit card cleverly. You'll find that it's possible to benefit in multiple ways," she adds.

"These benefits include saving on time and trouble spent searching for an ATM or keeping cash on hand, tracking expenses through credit card statements and use revolving credit for low-cost loans. A credit card also offers a safer alternative for travellers who can choose a daily limit and which countries to use it in, lowering the chance of fraudulent activity," says Sebidi. "Credit cards also tend to have insurance linked to them, which makes the reversal of fraudulent transactions easier than on a debit card. A credit card can also give you rewards. For example, the Discovery Card gives you cash back, while offering opportunities to earn Discovery Miles and other exclusive benefits."

What does savvy use of a credit card entail?

It is important always to plan your spending. "This means having the cash available to settle the card in full, even after an unplanned purchase," says Sebidi. "Also remember that owning a credit card equates to dealing with interest. Often you have between 25 to 55 days' interest-free credit, after which you start paying interest. It's therefore important to read the fine print and understand the terms and conditions of your credit card's use."

A well-managed credit card can be an excellent way to show proof of financial savvy and build a strong credit score or rebuild a credit score if you have had past problems (if you stay within your means and pay your account on time). "Yet, unruly spending can destroy your credit score. It's very important to live within your means," adds Sebidi.

Blow the cobwebs off 11 common credit card mistakes

  1. Paying your instalment late. This not only increases the amount of time it takes to pay off a credit card balance, but also the amount of interest you pay on the debt. Set a reminder for yourself every month to allow enough time to send your credit card payment through.
  2. Making minimum-only payments increases time taken to pay off a credit card balance and interest paid on the debt.
  3. Loaning out your card - you have no control over others' purchases but are responsible for the debt.
  4. Waiting to report a lost or stolen credit card creates further opportunity for fraud.
  5. Maxing out your credit limit - this puts you at risk for over-the-limit fees and penalty interest rates when you exceed your credit limit.
  6. Paying your instalment and using the amount up again immediately shows poor financial management. Look through your payment history to identify unnecessary spend.
  7. Using one card to pay another card's instalment implies a debt cycle that's growing.
  8. Not knowing what you're charged every time you use your credit card.
  9. Not reading the fine print means ignoring the terms of your credit card's use, not understanding how late payments will be dealt with and more. Review your credit card provider?s terms at least once or twice a year.
  10. Having too many credit cards ups your chances of getting into deep debt. And, not only can having multiple cards impact your credit score and ability to borrow money, but the annual fees on multiple cards can also add up.
  11. Buying things you don't need: people tend to spend more money using a credit card than when paying with cash. Go over your credit card statement every month and reflect on the items you could have done without or that were impulse buys.

Put a Spring into your financial plan: Credit card rules of thumb

"Make sure you have the cash available to settle the credit used on the card or make sure you have the amount to settle the card within an acceptable period. Usually, this shouldn't be more than three to six months for larger purchases,? says Sebidi. ?If you plan to use your credit card for day-to-day expenses like groceries, petrol, entertainment and so on, load your budgeted spending money onto the card. In this way, you'll use one account a month, making it easier to manage your money better and prevent paying interest on daily essentials like food."

When it comes to healthcare costs, ideally don't use your credit cards to pay medical bills unless you have the cash to settle them. Rather come to a payment arrangement with your healthcare provider. This way, you don't carry the interest on your card, which may be much higher than a payment arrangement made with your healthcare provider.

Don't increase credit limits unless you need the extra credit and have a well thought through financial plan making sure you have the cash to pay the money back. If you run into trouble, negotiate a new payment plan with your credit card provider and stop using your credit card until you're in a good financial position again.

"The first strategy to becoming financially fit is to actively manage your debt and make it a principle to borrow less than you can afford. Start by sticking to your budget and not resorting to credit when you want something, without first fully considering the financial implications of doing so," adds Sebidi. "Also remember that, if you reduce and manage your debt well, you are less likely to be impacted by interest rate increases."

New Season. New (financially fit) You!

"It feels great to spring clean your home and to enjoy the start to a fresh new season," says Sebidi. "The same can be said when you spring clean your finances. You can replace outdated money management systems and habits, get organized, and rediscover your financial priorities to make the next 12 months even better than the last.

Phuti Sebidi

Chief Customer Officer for Discovery Card

With a B.Sc. in Microbiology and Biochemistry, as well as an MBL in Services Marketing and Strategic Management, Phuti Sebidi joined Discovery Health during the early stages of business market entry. After 14 years in healthcare, she took on the role of Chief Client Officer engaged in building Discovery's new banking product.
Discovery recommends for you

Join the Discovery Card family

Discovery Card is a credit card that rewards you for healthy living. Use it to earn and spend Discovery Miles, and to boost your travel rewards. Plus, you can get up to 50% of your Vitality points back in Discovery Miles.

Call us on 0860 000 628 to begin your credit card application or click below and leave your details, and we will call you back.

Request a call back

Discovery Miles: Helping you to take your money further

Did you know that you can earn Discovery Miles every time you swipe your Discovery Credit Card? You can earn up to 10 times more Discovery Miles by shopping at the wide range of partner stores in the Discovery Miles Multiplier Network. This network covers everything from electronics to toys, sports and outdoor equipment and even convenient daily essentials like your fuel at BP filling stations and daily grocery items from Pick n Pay, Clicks and Dischem. 

Spending your Discovery Miles digitally is also easy. You can use them to shop online at partners like Pick n Pay, Dischem and Sportsman?s Warehouse, or use them towards your next holiday.

Find out more about Discovery Miles

Related articles


Vitality cash back puts Thathane family on a health high

Health and fitness is priority in the Thathane household. And, their healthy choices are not only rewarding them with energy and longevity, they're also earning significant cash back every month with Discovery Vitality.


Do you know your credit behaviour patterns?

If you're thinking about borrowing money for a big life purchase like a new home, a car or an overseas family holiday, it's important to know your credit score. Why? Because knowing where you are on the scale can have a huge effect on the interest rates you'll be offered.


Make the most of that paycheck! Getting through the recession

It's official - we're in our first recession since 2009. See it through with these tips to better manage your money.

Log in