COMMON FIRST-TIMER MISTAKES AND HOW TO AVOID THEM
1.Using Too Much of Your Credit Limit
Mistake: Maxing out a credit card or retail store account.
Why it’s bad: High utilisation = lower score.
How to Fix: Keep your balance below 30% of your limit (e.g., R3000 on a R10 000 limit).
2.Missing or Skipping Payments
Mistake: Forgetting debit orders or paying late.
Why it’s bad: Just 1 missed payment can hurt your credit for 24 months.
How to Fix: Set automatic debit orders and calendar reminders.
3. Opening Too Many Accounts at Once
Mistake: Taking multiple store accounts or loans in a short time.
Why it’s bad: Too many inquiries = “risky” profile.
How to Fix: Space out credit applications. Apply only for what you really need.
4. Ignoring Your Credit Report
Mistake: Not checking your credit report until it’s too late.
Why it’s bad: You won’t spot errors, fraud, or areas to improve.
How to Fix: Check your report every 3–4 months for free.
5. Thinking ‘No Credit’ = ‘Good Credit’
Mistake: Avoiding credit completely.
Why it’s bad: No credit history = lenders can’t assess you.
How to Fix: Start small. Try a student credit card, retail account, or cell phone contract and pay on time.
6. Only Paying the Minimum Amount
Mistake: Paying just the “minimum due” each month.
Why it’s bad: Debt lingers longer, and interest piles up.
How to Fix: Always pay more than the minimum—even R50 extra helps!
7. Closing Old Accounts Too Soon
Mistake: Cancelling your first credit card or account quickly.
Why it’s bad: It shortens your credit history.
How to Fix: Keep your oldest account open, even if unused occasionally.
8. Emotional Spending
Mistake: Using credit to cope with stress, FOMO, or pressure.
Why it’s bad: You spend beyond your means and build bad habits.
How to Fix: Track emotional triggers & stick to a budget. Learn to say, “not now” instead of “yes.”