In December 2022, Starita released a detailed report showing that credit card debts in the third quarter of 2022 were more than $9 trillion. In other words, credit card debts went up by 41% compared to 2021 – and it makes sense.
More Americans are relying on credit cards to keep up with their daily lying expenses. As it stands, average Americans can not simply bring enough food to the table and the only ray of hope for them is owing a credit card.
But the problem is that having a credit card account is not the solution. Although it may help you, for the time being, it can worsen your financial situation moving forward. One day or the other, you are bound to pay these debts. Whether these debts are credit cards, mortgages, or personal loans.
With that said, here are some of the reasons that you should not open a new credit card in 2023:
Pay Off Your Debts First
It is a fool’s paradise to add debts when you are already drowned in debts. By opening a new credit card, you are intending to add a new credit line. In other words, you are adding to the debts that you already owe.
So, pay off your debts first – be it credit card debts, personal loans, or mortgages. Keep in mind that interest rates are growing at a faster pace – especially when we are headed toward the looming recession. In such a scenario, opening a new credit line is simply not an option.
Therefore, do not open a new credit card unless your outstanding bills are completely paid. Adding a new credit card will only make things worse.
Do Not Spend Lavishly During the Holidays
Another apparent reason for not opening a new credit card this new year is the extravagant holiday expenses. If you have a credit card, you will likely spend a lot of money during the holidays. From Christmas to the New Year Celebration, you will likely spend a lot of money – on your credit card. In turn, these debts will be added up to your loans.
Therefore, it is a sensible idea not to open a new credit card in 2023. Ideally, set not opening a new credit card as your new year resolution. This will help you thrive in the upcoming years.
Furthermore, having a credit card will make you feel that you are good to spend as much as you want. But in the long run, these debts will add up to your existing debts. So, avoid a new credit card in the new year – for good. Definitely, it is a worthwhile new year resolution to remain committed to.