It’s always handy to carry a little cash, but more and more, credit cards are becoming the standard way of purchasing things. As banks are steadily increasing their fees for using debit cards and having regular accounts, many people are choosing to use credit cards. Continue reading to find out how these cards work and how to use them properly.
Know what interest rate your card comes with. 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. Without a clear understanding of the interest charges, your bills could rise unexpectedly. If you’re paying more, you may not be able to afford to pay off the debt each month.
Communicate with your creditor if you ever run into financial hardships. If you’re going to miss a payment, the credit card company may agree to adjust your payment plan. This could help because they may not end up reporting your late or missed payment to the credit agencies.
Make your credit card’s pin code difficult to guess correctly. Using something familiar, such as your birth date, middle name or your child’s name, is a big mistake since this information is readily available.
Watch the terms and conditions on your credit card accounts carefully. In today’s society, many companies will change their conditions or terms at frequent intervals. These changes may be buried within hard to understand legal terms. Make sure you read everything so you know what to expect as far as rates and fees are concerned.
Do not buy anything online with a credit card until you are certain that it is a legitimate business. Make sure to call the listed phone numbers to ensure that the company is who they say they are. Also look for a physical address listed.
Never believe your offered interest rate is absolute and should remain this way. The industry that runs credit cards are competing all the time, so they always have various interest rates. If your interest rate is high, call your credit company and see if they will change it before you switch to a new card.
Don’t close accounts. Although you may think doing this will help you raise your credit score, it can actually lower it. When you close your accounts, you are taking away from your actual credit amount, which decreases the ratio of that and the amount you owe.
Avoid charging things like groceries or restaurant tabs on your credit card as these can take a while to appear on your monthly statement, which means possibly underestimation the balance you really have available to you. This can result in more fees on your account if you spend over your limit due to the groceries or restaurant bills not posting fast enough.
Never send your card number by phone, fax or email to anyone unless you are certain it’s secure. If you receive an offer that is unsolicited and asks for the card number, be even more cautious. There are a variety of scams designed to gather credit card information from unsuspecting consumers. Therefore, it is important to protect yourself and remain diligent.
If you have more than one credit card, try to pick one to pay off every month. 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.
Once your credit account is closed, shred your card. If you choose to put it in a drawer, the card could find itself in another person’s hands, and he or she could use your information to open up your account and charge lots of debt that is in your name.
You should try to stay away from cards that have annual fees. These cards are usually only offered to people that have good credit. These fees can wipe out any perks the card offers, though. Do the math. These fees are usually not heralded by credit card companies; they can usually be read in the small print of the terms and conditions. Use a magnifying glass if the print is too small. Find out if those fees negate the promoted benefits. Normally, they don’t.
Credit Card Spending
Post a running tally of your current month’s credit card spending on your refrigerator or bulletin board. This way you can instantly see how much you have spent and what your current total is. Too often, we let credit card spending get out of control by not self-monitoring and before long, we find ourselves in hot financial water!
If you are transferring the balance from one card to another, at a lower introductory interest rate, make sure you understand the terms and conditions. Make certain you are clear as to what will happen once the introductory term is over. Many times the interest will be incredibly high later on. Know what you are getting into prior to signing on the bottom line.
Credit card usage is increasing as more individuals choose them over the growing regulations and fees charged for debit card use. Given the expansion and growth in this area, you could also benefit from the perks that credit cards can give. Use the information presented in the tips above to help you to get the most from your bank cards.