MONTREAL- We Canadians love our credit cards, but with the holidays now over, it's time to pay the piper.
The average Canadian cut 3.4 per cent off their credit card debt in 2011, according to Equifax Canada.
That's good news for a country that owes about $6,000 per person, without taking into account mortgage debt.
With that in mind, here are some true and tried reminders on how to control your debt.
"First of all, pay more than the minimum amount that they are telling you to pay each month," Stephanie Poulin of Option Consommateurs told CTV Montreal.
"Paying the minimum on your credit card is like taking out a mortgage at high interest and the result... It's going to take you as long as paying your house!"
Pay as much off as you can each month, Poulin said, and pay a day or two in advance of the due-date. Banks can charge higher interest rates even if you're only a couple of days late – which can also damage your credit rating.
Secondly, try to avoid doing cash advances.
Using your credit card instead of cash is a sure way to inflate your spending and debt, especially when you add interest on top.
And Poulin reminds us there's another price to pay for credit card convenience.
"When you use your credit card, merchants pay fees, so it is transferred in the costs of the goods you pay," she said. "So there's this impact as well."
Thirdly, beware of racking up credit card debt to earn reward points. Especially if you can't pay off your balance each month.
That "free" flight you're aiming for may cost you twice its value once you add up the interest payments.
Fourthly, evaluate whether your card's rewards are really worthwhile. If not, switch to another card, preferably one that doesn't charge you an annual fee.
And finally, if you really want to cut credit card debt, cut your cards – literally.
The fewer cards you carry, the easier it will be to keep your debt in check.
