Credit cards are almost a necessity of modern life, but the easy credit that they offer can get many people in trouble. Knowing how to use credit cards responsibly is a key part of your financial education. The tips in this article will help make sure that you do not abuse your credit cards.
When choosing the right credit card for your needs, you need to make sure that you pay attention to the interest rates offered. If you see an introductory rate, pay close attention to how long that rate is good for. Interest rates are one of the most important things when getting a new credit card.
Decide what rewards you would like to receive for using your credit card. There are many options for rewards that are offered by credit card companies to entice you to applying for their card. Some offer miles that can be used to purchase airline tickets. Others give you an annual check. Choose a card that offers a reward that is right for you.
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.
Minimum payments are designed to maximize the credit card company’s profit off of your debt in the long run. Try to make a larger payment than just the minimum. Paying off your balance faster helps you avoid expensive finance charges over the life of your debt.
Take advantage of the fact that you can get a free credit report yearly from three separate agencies. Make sure to get all three of them, so that you can be sure there is nothing going on with your credit cards that you may have missed. There may be something reflected on one that was not on the others.
Instead of just blindly applying for cards, hoping for approval, and letting credit card companies decide your terms for you, know what you are in for. One way to effectively do this is, to get a free copy of your credit report. This will help you know a ballpark idea of what cards you might be approved for, and what your terms might look like.
If you wish to get a credit card that has great rates and benefits, keep an eye on your credit score. Credit card providers always investigate your credit score before they accept your application for a credit card. The best credit cards, those with low rates, cash back, and great points options, are only given to consumers with superb credit scores.
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!
Keep a close eye on any changes to your terms and conditions. Credit card companies have recently been making big changes to their terms, which can actually have a huge impact on your personal credit. The most significant changes may be couched in legal terminology. Do not skip anything when reading, and pay particular attention to fees or rate adjustments.
Never use a credit card to buy things you can’t afford. If you would like a new television, save up some cash for it rather than assume your credit card is the best option. It costs a lot of interest, and that makes monthly payments pretty much impossible. Get out of the store so you can think about it for a while prior to making a decision. If you are still going to purchase, then the store probably offers a financing plan that gives you a lower interest rate.
Anytime you apply for a credit card, you should always familiarize yourself with the terms of service that comes along with it. This will allow you to know what you can and cannot use your card for, as well as, any fees that you might possibly incur in different situations.
Most professionals say that limits on your credit cards should not be more than 75% of what your salary is every month. Taking on a card, whose limit is greater than this amount, may leave you struggling to pay the bill. This happens when the interest builds up it becomes too hard to pay back.
You should ask the people at your bank if you can have an extra checkbook register, so that you can keep track of all of the purchases that you make with your credit card. Many people lose track and they assume their monthly statements are right and there is a huge chance that there may have been errors.
If you pay your credit card bill with a check each month, make sure you send that check out as soon as you get your bill so that you avoid any finance charges or late payment fees. This is good practice and will help you create a good payment history too.
Even if you cannot make your minimum monthly payment on a credit card, you should pay something. No matter how modest the amount, this will tell your credit card company that you are trying to deal fairly with them. If your problems continue, you will find your company more inclined to work with you if you have been making at least some payments.
Having access to credit makes it much easier to manage your finances, but as you have seen, you need to do so with care. It is all too easy to over-extend yourself with your credit cards. Keep the tips you have learned from this article in mind, so that you can be a responsible credit card user.
