4 Signs You Should Use Your Credit Cards Less in 2023

Credit cards are a great tool, but it takes time to learn how to use them well.

Many people use credit cards in their daily lives because they're convenient. But if you're not cautious, your credit card habits could get you in trouble -- you could accumulate credit card debt or hurt your credit score. If you're struggling to manage your spending, you may want to reduce your credit card usage, so you don't put yourself at risk for financial troubles. Here are some signs that you should use your credit cards less frequently in 2023.

1. You continue to carry a balance

If you're using credit cards but aren't paying your entire credit card balance off every month, that can be dangerous. The longer you carry a balance each month, the more debt you will have to pay off because interest grows on unpaid debt. Eventually, it could become a stressful situation that negatively impacts other areas of your life beyond your finances.

The best practice is to use your credit card to charge what you can pay off monthly. Doing this will let you avoid credit card interest charges and make your credit card bills more manageable.

If you have existing credit card debt, it's worthwhile to stop using credit cards until you tackle your debt. You might explore opening one of the best balance transfer credit cards and transferring existing card balances to your new card.

You'd then get to take advantage of 0% interest on your transferred balance during the promotional period, which could help you pay down your debt faster and save on interest charges.

2. You're tempted to spend more than you can afford

It's best to consider what you can afford before charging your card. If you're tempted to overspend, you could quickly get into debt. While it's possible to pay off debt, it takes time and effort and could take longer to crawl out of if you have a lot of debt.

If you struggle with overspending, it's a good idea to put your credit cards away for some time until you develop new spending habits. If you need help managing your spending, creating a budget may help better guide your purchase decisions.

READ MORE: Best Budgeting Apps

3. You're missing payments

Missing credit card payments or paying them very late is not ideal. For starters, your credit card issuer will likely charge you late fees -- and those extra expenses can add up fast.

If you continue to miss payments or pay your credit card bills late, you might also harm your credit. Your payment history, which includes whether you pay bills promptly, is an important factor that goes into your credit score.

If you're missing payments regularly, it's probably not a good idea to continue using your credit card until you get into a better bill payment routine. Setting up automatic payments through your credit card issuer could help you stay on track and avoid paying your bill late. But make sure you have plenty of money in your checking account if you plan to do this.

4. Your financial situation has changed or will change soon

If your financial situation has recently changed or is about to, you may want to consider using credit cards less. It can be a big lifestyle adjustment when you experience significant financial changes, such as a job loss or a reduction in hours or pay. To avoid spending more than you can afford and avoid the risk of going into debt, it's good practice to reduce your credit card usage habits as you adjust to your new lifestyle.

Credit cards are essential personal finance tools for many people. But you want to make sure your credit card habits aren't doing a disservice to your finances and your credit. The good news is you can make small changes that make a big difference, and once you feel more confident, you can use credit cards to your advantage.