Today’s smart consumer knows how beneficial the use of credit cards can be, but is also aware of the pitfalls associated with excessive use. Even the most frugal of people use their credit cards sometimes, and we all have lessons to learn from them! Keep reading for valuable advice on using credit cards wisely.
It’s useful credit practice to continuously keep two or three active credit cards. This will assist you in raising your credit rating if you pay all balances in full monthly. You should have no more than three open credit cards. If you have more than three credit cards, it may be more difficult to qualify for a loan.
To make the best decision regarding the best credit card for you, compare what the interest rate is amongst several credit card options. If a card has a high interest rate, it means that you will pay a higher interest expense on your card’s unpaid balance, which can be a real burden on your wallet.
You know that paying your credit card bill late will incur a penalty, but you should remember that there is a penalty for running your balance over your credit limit, too. Both fees are pretty expensive and can also affect your credit score. Track your spending carefully so that you don’t go over your limit.
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!
Use a credit card to pay for a recurring monthly expense that you already have budgeted for. Then, pay that credit card off each and every month, as you pay the bill. Doing this will establish credit with the account, but you don’t have to pay any interest, if you pay the card off in full each month.
Keep contact information for credit card companies, your account number, and all other relevant data in a safe place that is easy for you to access. Maintain it in a secure place, like a safe, and keep it separated from your cards. Should your cards ever be lost or stolen, you can use this list to promptly notify the companies that issued your credit cards and advise them of the situation.
Don’t believe that any interest offered to you is concrete and will stay the same way. Credit card companies are in major competition with each other, so different companies will offer different rates to their potential customers. Call your bank if you don’t like your current interest rate. Ask the bank to change your rate.
As noted earlier, you have to think on your feet to make really good use of the services that credit cards provide, without getting into debt or hooked by high interest rates. Hopefully, this article has taught you a lot about the best ways to use your credit cards and the best ways not to!