The Right Way Of Using Credit Cards

By Marian Scott


With all of the credit card horror stories out there, it is no wonder that some people are afraid of credit cards. There is no reason to fear owning a credit card. They help to build your financial history and credit score, making it easier for you to get loans and low interest rates. The following article contains some valuable credit card advice.

Make sure you can afford everything you buy with a credit card. It's fine to use credit cards to stretch out the payments for an item you can afford, but refrain from making a major purchase that you couldn't afford otherwise.

By keeping track of all your credit card purchases, this will help you from spending more money than you can actually afford. It is quite easy to lose track of what you are using your credit card for, so you should commit yourself to keeping track of all of these expenditures in either a small business accounting software or on a spreadsheet.

Do not get credit cards the minute that you are old enough to get them. Although people love to spend and have credit cards, you should truly understand how credit works before you decide to establish it. See how adult life is before you decide to get your very first credit card.

Avoid the temptation to lend your credit cards to anyone. Even if it is a great friend of yours, that should still be avoided. Doing so can cause over-limit charges when someone else charges more to the credit card than you said he could.

A lot of people don't get credit cards so it looks like they have no debt. Credit cards build credit, so you really should have at least one. Use the card, and pay it in full every month. If you do not have any credit cards, your credit score will be lowered and you will have a harder time being approved for loans, since lenders will not know able you are to pay off your debts.

Keep a close eye on your balance. Be sure you know your card's limit before making purchases. If you do happen to go over your credit limit, the creditor will impose fees. Try contacting your credit card company for an increased limit if you consistently go over your current limit.

Be sure that you fully understand the terms of the credit card prior to signing up for it. Certain credit card companies have hidden fees and special requirements that must be met before benefits apply. Read each word in the fine print so that you completely understand their policy.

Carefully consider all the fees associated with a particular card. The interest rate and APR are important, but be mindful of all the fees that come with a card. Application fees, cash advance fees and service charges are sometimes involved that make having the credit card less worthwhile.

It can be tempting to break out your credit card for every purchase, especially if you earn rewards; however, if the purchase is very small, opt for cash instead. Lots of retailers have a minimum amount for credit usage, so you may end up purchasing extra to reach this. Save your credit card for purchases of $10 or more.

There are still many beneficial aspects to cards that provide no reward programs or other perks. People who don't use their cards properly may be gratified in the short term but suffer long-term stress over bills. Use the information you have learned here to be in the group you want to be in.




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