Some Mississippi consumers may be paying more than they have to in credit card interest rates because of a prevalent myth. Many people believe that carrying a balance is a way to build credit, but financial experts say this is not the case.

A report from Creditcards.com found that more than one-fifth of cardholders carried a balance as a way to build their credit. However, this is not one of the criteria used to determine a credit score. In fact, carrying a balance can hurt a person’s credit if the balance is creeping up toward the card’s limit.

A balance on a credit card can damage an individual’s finances in other ways as well. Interest rates may be 16 percent or higher, so some experts say that even if the belief that carrying the balance were true, the additional costs would not offset the benefit of the boost. Paying a bill on time is much more important although more than 40 percent of people reported that they had made a late payment. The most common reason for a late payment is forgetfulness followed by a lack of money to make it. Experts say the best way to use a credit card is to pay it off in full on time each month.

Unfortunately, some people may be carrying a credit card balance not because they hope to build their credit but because they are unable to pay it off. People who are struggling may want to talk to an attorney about debt relief and whether it might be time to file for bankruptcy. While bankruptcy does damage a credit score, so does falling more and more behind on bills, and once the bankruptcy is discharged, a person can begin rebuilding credit once more.