Some people view cards suspiciously, as if these pieces of plastic can magically destroy their finances without their consent. The truth is, however, cards are only dangerous if you don’t know how to use them properly. Read on to learn how to protect your credit if you are using credit cards.
When it is time to make monthly payments on your cards, be sure that you pay more than the minimum amount that you are required to pay. If you only pay the small amount required, it will take you longer to pay your debts off and the interest will be steadily increasing.
Try to keep at least three open card accounts. Having two or three cards will help you to improve your credit rating. But, if you have over three cards open, creditors may look upon that fact unfavorably.
In order to minimize your card debt expenditures, review your outstanding card balances and establish which should be paid off first. A good way to save more money in the long run is to pay off the balances of cards with the highest interest rates. You’ll save more in the long term because you will not have to pay the higher interest for a longer period of time.
Credit cards are often essential for young people or couples. Even if you don’t feel comfortable holding a large amount of credit, it is important to actually have a account and have some activity running through it. Opening and using a credit account helps you to build your credit score.
It should be obvious, but many people fail to follow the simple tip of paying your card bill on time each month. Late payments can reflect poorly on your credit report, you may also be charged hefty penalty fees, if you don’t pay your bill on time.
Students who have cards, should be particularly careful of what they use it for. Most students do not have a large monthly income, so it is important to spend their money carefully. Charge something on a card if, you are totally sure you will be able to pay your bill at the end of the month.
Look into whether a balance transfer will benefit you. Yes, balance transfers can be very tempting. The rates and deferred interest often offered by 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.
An important tip when it comes to smart card usage is, resisting the urge to use cards for cash advances. By refusing to access card funds at ATMs, you will be able to avoid the frequently exorbitant interest rates, and fees card companies often charge for such services.
A great tip for saving on today’s high gas prices is to get a reward card from the grocery store where you do business. These days, many stores have gas stations, as well and offer discounted gas prices, if you sign up to use their customer reward cards. Sometimes, you can save up to twenty cents per gallon.
If you have poor loan and want to repair it, consider a pre-paid card. This type of card can usually be found at your local bank. You can only use the money that you have loaded onto the card, but it is used as a real card, with payments and statements. By making regular payments, you will be repairing your credit and raising your credit score.
Try to keep at least three open card accounts. Having two or three cards will help you to improve your credit rating. You should have no more than three open cards. If you have more than three credit cards, it may be more difficult to qualify for a loan.
Student Credit Cards
Credit cards can be a convenience for students, but they should be aware of the card terms associated with their card. A lot of times, credit cards for students have annual fees or penalties that can end up being quite a bit, so do lots of research before choosing one.
Cash Back Credit Cards
Look out for cash back cards. These types of credit cards give you cash back on every purchase that you make with the credit card. Cash back rates can range from 1% to 5%, so over the course of a year, you could actually earn a lot of cash back.
Secured Credit Cards
A lot of banks no longer issue secured cards, but it is common to find them being offered through credit unions. If you would like to sign up for a secured credit card, you can open an account with a credit union and take advantage of whatever cards they offer.
Prepaid Credit Cards
Avoid bank fees and red tape by using your credit card. Many debit cards are simply packed with unavoidable fees; in contrast, the right card can be used without fees if it is completely paid off on a month-to-month basis. Many people are forgoing a traditional bank, and using a prepaid card for depositing their paychecks.
Types Of Credit Cards
Look out for cash back cards. These types of credit cards give you cash back on every purchase that you make with the card. Cash back rates can range from 1% to 5%, so over the course of a year, you could actually earn a lot of cash back.
As you can see, cards don’t have any special power to harm your finances, and in fact, using them appropriately can help your credit score. After reading this article, you should have a better idea of how to use cards appropriately. If you need a refresher, reread this article to remind yourself of the good credit card habits that you want to develop.