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.
You should always try to negotiate the interest rates on your credit cards instead of agreeing to any amount that is always set. If you get a lot of offers in the mail from other companies, you can use them in your negotiations, to try to get a much better deal.
Learn how to responsibly handle your credit card accounts. While sometimes debt is unavoidable, consumers commonly abuse the privileges involved in having credit cards and impulsively make buying decisions that they cannot afford. You should always pay your full balance each month. By doing this, you are effectively using credit, maintaining low balances, and increasing your credit score.
To help you get the maximum value from your credit card, choose a card which provides rewards based on the amount of money you spend. Many credit card rewards programs will give you up to two percent of your spending back as rewards which can make your purchases much more economical.
Be aware of the interest rate that you are being charged. This is especially true before signing up for a new card, so read the fine print or ask the right questions to determine the interest rate you would be paying with the card. Choosing a card with a high interest rate will cost you dearly if you carry a balance. If the rate is higher, you may find that you can’t pay the card off every month.
If you find that you have spent more on your credit cards than you can repay, seek help to manage your credit card debt. It is easy to get carried away, especially around the holidays, and spend more than you intended. There are many credit card consumer organizations, that can help get you back on track.
A key credit card tip that everyone should use is to stay within your credit limit. Credit card companies charge outrageous fees for going over your limit, and these fees can make it much harder to pay your monthly balance. Be responsible and make sure you know how much credit you have left.
Make sure that you watch your statements closely. If you see charges that should not be on there, or that you feel you were charged incorrectly for, call customer service. If you cannot get anywhere with customer service, ask politely to speak to the retention team, in order for you to get the assistance you need.
Keep an eye on your credit rating. Good credit is considered to be a credit score over 700. Put your credit to work to maintain that score or to help you reach it. At a score of 700 or higher, you’ll receive the best credit offers with the lowest rates.
Only spend what you could afford to pay for in cash. The benefit of using a card rather than cash, or a debit card, is that it establishes credit, which you will need to get a loan in the future. By only spending what you can afford to pay for in cash, you will never get into debt that you can’t get out of.
An important tip when it comes to smart credit card usage is, resisting the urge to use cards for cash advances. By refusing to access credit card funds at ATMs, you will be able to avoid the frequently exorbitant interest rates, and fees credit card companies often charge for such services.
A great way to save money on credit cards is to spend the time necessary to comparison shop for cards that offer the most advantageous terms. If you have a decent credit history, it is highly likely that you can obtain cards with no annual fee, low interest rates and perhaps, even incentives such as airline miles.
While it is important to look at the interest rate of a credit card you are applying for, you should also look at any hidden fees that aren’t immediately apparent. Look for fees like service charges, cash advance fees, and application fees.
Transferring a credit card balance from a high interest credit card to a card where the rate is less, can save you money every month. Credit card companies offer special introductory rates to attract new business to their credit cards. If you take advantage of one of these offers, make sure that you understand the amount of time that the introductory rate offer lasts.
If you have balances on several credit cards, choose one and work on paying it off. Even if you carry large debt on your other cards, keeping a card that is paid off each month helps build a more positive credit record.
When getting a credit card, a good rule to follow is to charge only what you know you can pay back. Yes, many companies will require you to pay only a certain minimum amount every month. However, by only paying the minimum amount, the amount you owe will keep adding up.
If you have good credit, but are paying a high annual percentage rate, contact your credit card issuer and ask them to lower it. A lot of times they will bring it down for you. This will save you plenty each month, if you have a balance on your card.
Be certain to understand the terms of any secured card before accepting an offer. Most times, you’re told to deposit a small amount but you’re not aware that your money could be used up by fees that end up making you have a lower credit limit.
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!