Shopping online is convenient with lots of payment options available. These are easier to use than ever before thanks to intuitive apps, reliable platforms, and secure encryptions. However, people should still spend their money responsibly to avoid problems in the future. Loans should be used wisely so that they do not grow to unmanageable levels. Consider the following carefully before online shopping whether using credit card electronic wallet or others:

Necessity of Purchase

What is the purpose of the item? Is it necessary to spend for it? Could it be paid in cash? If it’s an important matter that requires urgent funds, then perhaps there is no other choice but to borrow money for it. Emergency medical expenses are a good example. Maybe a loved one got into an accident and needs a wheelchair or other devices. The need may outweigh the fact that credit card loans carry high interest rates. If there are other means to secure funds, then these should be explored as well. You could transfer cash to your electronic wallet and use that.

Payment to Income Ratio

Shoppers should also think about whether they can afford to pay for the item in comfort. They should consider the payment amount and its proportion to the monthly income. For credit card loans, the ratio should probably be much smaller than monthly car payments and similar obligations, especially if the borrower is already paying for these other debts.

Loans to Income Ratio

Indeed, most financial articles will put a cap of 36% on total loans as a proportion of the monthly income. Some may allow this to rise up to 50%. Anything higher than this can put the borrower in peril. This means a person who is already paying for mortgage, auto loan, student loans, and other debts should check if there is still space left before reaching the limit. If the answer is yes, then it should be manageable. If the answer is no, then other funding options should be explored.

Income Stability Forecast

The borrower should also see to it that their current income is stable enough to ensure full payment down the road. If they are a regular employee in a company, then this has a good chance of happening. Having a business with good cash flow is also a strong indicator. Credit card electronic wallet may be used for minor bumps and paid as soon as possible to prevent late fees and high interest payments.