Having a credit card can be a good way to build a responsible credit history. Consumers should be well-informed about credit cards so that they can make the right decisions. The following contains advice on credit cards that can help people get better at using their cards, so they don’t damage their credit score and get into debt.
Do not use your credit cards to make emergency purchases. Many people believe that this is the best use of credit cards, but the best use is actually for things that you purchase on a regular basis, like groceries. The key is, to only charge things that you will be able to pay back in a timely manner.
Lots of credit cards will offer bonuses simply for signing up. Read the fine print thoroughly, though, as the terms for qualifying for the bonus may be quite strict. Often, you must spend a particular amount within a certain time period; think about whether or not you can do what the terms require prior to getting excited by the offer.
If you are not satisfied with the high interest rate on your credit card, but aren’t interested in transferring the balance somewhere else, try negotiating with the issuing bank. You can sometimes get a lower interest rate if you tell the issuing bank that you are considering transferring your balances to a different credit card that offers low-interest transfers. They may lower your rate in order to keep your business!
Don’t use your credit cards to purchase items that you can’t afford. Just because your credit limit is high enough to cover that flat-screen television you eyed at the store, does not mean it is within your budget. It costs a lot of interest, and that makes monthly payments pretty much impossible. Leave before buying anything, think it through and then return if you want to buy it. If you still want the item, see if the store offers in house financing with better rates.
Don’t open too many credit card accounts. A single person only needs two or three in his or her name, in order to get a good credit established. More credit cards than this, could actually do more damage than good to your score. Also, having multiple accounts is harder to keep track of and harder to remember to pay on time.
Look into whether a balance transfer will benefit you. Yes, balance transfers can be very tempting. The rates and deferred interest often offered by credit card companies are typically substantial. But if it is a large sum of money you are considering transferring, then the high interest rate normally tacked onto the back end of the transfer may mean that you actually pay more over time than if you had kept your balance where it was. Do the math before jumping in.
Reading the above text, you can glean various aspects of credit and begin to understand how to use a credit card to your full benefit. Knowing the differences between cards is key, because it facilitates wiser choices. Educate yourself on the basics of responsible credit card use so that you always make smart decisions.