The first step in choosing a credit card is making sure the benefits outweigh the costs. The article below discusses some of the best ways to use credit cards and avoid pitfalls. Many people who have credit cards do not have the knowledge needed to make wise choices. This can lead to big financial problems.
It is important that you are honest on how much money you make when you apply for credit. Many companies don’t check your actual income, so your limit may be way too high.
Anyone who owns a credit card should request a copy of their three credit reports annually. This can be done for free. Make sure that any information on your report syncs with what is on your statements.
Be cautious of any company that offers a zero percent rate on credit cards. Although this looks good on the surface, it often encourages people to overspend. The interest rate will increase after a specified period of time and these individuals can end up struggling to repay the balance owed.
To avoid losing more money, confront your credit company about the opportunity for a lower interest rate. It may be possible for you to obtain a better rate if you have established a history with this company and have consistently made timely payments. A quick call might be all that is necessary to lower your rate and facilitate real savings.
Try to just have a few credit cards. It can be challenging to use anything more than a single card since you will need to monitor your spending on each one. Having only a few credit cards will help you to be able to successfully monitor the amount of money you spend on each card and will help you keep debt low.
Credit card companies set minimum payments in order to make as much money from you as they can. Pay much more than what the minimum payment indicates. Paying off your balance faster helps you avoid expensive finance charges over the life of your debt.
Only use you credit card when necessary. Use your debit card instead whenever you can. An expensive purchase, like a computer or a TV, will probably need to be made with a credit card. Simple low cost purchases should be made with your debit card. This will save you money.
If you don’t want to lose a credit card, be sure to use it once in awhile. A lot of creditors will close inactive accounts. You have to use your credit cards occasionally so that your creditors do not close the unused accounts. It is also important to pay your accounts in full to remain debt-free.
You may want to think about getting a credit card that offers cash back on purchases, such as groceries and gas. This type of card is great for people who use their credit cards daily. You can receive a cash-back reward of $50 or more every month by using the card for such things as gas and groceries. Doing this could make for a handy holiday piggy bank However, you want to be careful you don’t keep a balance on the card because the interest rates charged will negate all the rewards.
Keep only the card you use on a daily basis with you each day. This will allow you to keep track of everything and will let you know if one goes missing. Credit card theft is on the rise, so it is important you are always aware of your credit card’s location. If you believe you have lost a card, cancel it quickly.
Keep an eye on your credit score to see if you’re managing your credit well. This also gives you an idea of how your creditors are managing your accounts. Check for any wrong information. If there’s one, talk to the credit bureau and the card company.
Before making an online purchase with your credit card, you need to make sure that you are dealing with a legitimate seller. You should contact whoever runs the site on the phone prior to ordering and don’t use a company that has no real address on their website.
As the article said in the beginning, it is easy to start getting into debt when you don’t know how to use a credit card. With multiple cards, and multiple pricey purchases, you will find yourself in deep trouble. This article should, hopefully, teach you some ways to avoid the trouble that can find you regarding credit cards, so you can remain financially healthy
Article By Your Debt Relief Company