Credit Card Debt Myths Debunked: New Guidance from NPR Life Kit
Washington, D.C.- Many Americans operate under misconceptions about managing credit card debt, possibly hindering their financial well-being. NPR’s Life Kit recently tackled three prevalent myths,offering expert advice to help consumers navigate debt and build better credit.
One common belief is that having no credit is better than having a credit card and potentially incurring debt. However, according to John Kiernan, managing editor of WalletHub, a good credit standing-built through responsible credit card use-is essential. “Owning a credit card that’s in good standing will send positive data to the credit bureaus each month, which will make your credit report look better and then, in turn, lead to a better credit score, which helps you save a lot of money and opens a lot of doors for lending,” Kiernan explained.
Another myth centers on aggressively paying down debt at the expense of savings. Financial educator Rita Soledad Fernandez Paulino cautions against this approach. “If you take all your cash, pay off the credit card, it’s only a matter of time before you’re going to get into debt again,” she stated, emphasizing the importance of establishing an emergency fund to prevent future reliance on credit.
many are unaware of the flexibility available with credit card terms. Consumers can proactively contact their card issuers to negotiate lower interest rates, fee waivers, or other concessions, notably if they have a history of responsible use or can demonstrate competing offers. Making at least minimum payments is also crucial to avoid damaging credit scores and incurring late fees or collections. When managing multiple cards, prioritizing repayment of those with the highest interest rates can yield the greatest long-term savings.
For further information and resources, NPR’s Life Kit offers a credit card debt newsletter series at npr.org/creditcarddebt.
