“It matters” | Here are tips for using your credit card wisely

Gabrielle Gauthier-Veillette, financial security advisor and founder of Adultes “Responsables”, was on Wednesday in the “It matters” segment of the newsletter Noovo Info 22 with Michel Bherer to give us advice on the use of credit.

First of all, you need to differentiate between a credit card and a line of credit.

“A credit card can be linked to your checking account, or not, and in general the interests are quite high, between 10% and 22%,” explains Ms. Gauthier-Veillette, emphasizing that certain credit cards include annual fees or reward programs.

“A line of credit is much more linked to the checking account or a mortgage loan and the rates are a little lower, between 5% and 16%, depending on the state of the credit score,” continues- She.

video/2023/11/20/fraudes_en_hausselesinstitutionsfinancierespeuventrefuserdevousr" second-article-path="/content/dam/noovo-info/content-fragments/article/nouvelle/2023/10/30/les_jeunes_canadiensseraientpluspreoccupesparleurdetteselonequif" third-article-path="/content/dam/noovo-info/content-fragments/article/nouvelle/2023/10/24/refinancer_ou_renouvelerunehypothequecommentchoisirpoureviterunc">

What to use and when?

According to Gabrielle Gauthier-Veillette, the use of credit cards should be favored for inexpensive and quickly refundable purchases.

“If you think you can pay by the end of the month, before your credit card payment deadline, send it there, take advantage of it, earn points if you ever have a program,” she suggests.

However, if your purchase is more expensive, the line of credit could be an option.

“If you plan to drag out the payment over several months, it’s better to think about the line of credit,” says the financial security advisor.

To see and read other interventions from the “It matters” segment of Noovo Info 22, visit the “Chronicles” section on Noovo.Info.

Traps to avoid

Obviously, the use of credit can quickly have an impact on your personal finances.

“You have to see credit as a technique or a strategy to build your credit rating and not as free money,” emphasizes Ms. Gauthier-Veillette.

To avoid falling into the spiral of high interest charges on credit cards, it is better to pay off your balance in full and on time.

Gabrielle Gauthier-Veillette also points out that having too many credit cards “is bad for your credit rating.”

She also suggests paying attention to fluctuating interest rates when it comes to lines of credit.

And the best advice: “Make a budget!” says Ms. Gauthier Veillette. “This makes it possible to eliminate non-essential expenses.”

To hear and see all the advice from Gabrielle Gauthier-Veillette, financial security advisor, listen to the full interview in the “It matters” segment of the newsletter Noovo Info 22 with Michel Bherer in the video above.