Are there any good reasons to use credit cards? If you are one of the people who believes you should never own a credit card, then you are missing out on a useful financial tool. This article will give you tips on the best way to use credit cards.
If you apply for a store branded credit card, make sure it is a store that you shop at regularly. When you apply for store charge card, an inquiry is noted on your credit bureau report whether you are approved or not. Racking up a list of inquiries from several different retail stores can cause your credit score to drop.
Check your credit report regularly. By law, you are allowed to check your credit score once a year from the three major credit agencies. This may be often enough, if you use credit sparingly and always pay on time. You may want to spend the extra money, and check more often if you carry a lot of credit card debt.
Credit card companies set minimum payments in order to make as much money from you as they can. Therefore, you should aim to pay more than this. Avoid costly interest fees over the long term.
Odds are you’re well aware that late fees can be killer, but keep in mind that fees for going over your limit can also be quite harsh. They are both quite high and can have bad effects on your report. Don’t pass your credit limit or you will suffer.
Emergency, business or travel purposes, is all that a credit card should really be used for. You want to keep credit open for the times when you need it most, not when purchasing luxury items. You never know when an emergency will crop up, so it is best that you are prepared.
Make the minimum monthly payment in the very least on all of your credit cards. Not making the minimum payment on time can cost you a great deal of money over time. It can also cause harm to your credit rating. To protect both your expenses, and your credit rating be sure to make minimum payments on time each month.
Keep track of your credit score if you would like to get a good credit card. Creditors use your credit score to determine what sort of card they are willing to offer a potential customer. The very best cards are only given to consumers who have very high credit scores.
Take advantage of the freebies offered by your credit card company. Many companies have some sort of cash back or points system that is attached to the card you own. When you use these things, you can receive cash or merchandise, just for using your card. If your card does not offer an incentive like this, call your credit card company and ask if it can be added.
Don’t buy things that you can’t pay for on a credit card. Wanting a new TV or game console is not a good reason to put it on a credit card. You will end up being charged lots of interest and you may be unable to keep up with the monthly repayments on your credit card. Go home and take a day or two to think it over before making your choice. If it is still something you wish to purchase, check with the store, as their in-house financing may offer lower interest than your credit card.
Make sure you are consistently using your card. You do not have to use it frequently, but you should at least be using it once a month. While the goal is to keep the balance low, it only helps your credit report if you keep the balance low, while using it consistently at the same time.
It may seem unnecessary to many people, but be sure to save receipts for the purchases that you make on your credit card. Take the time each month to be sure that the receipts match up to your credit card statement. It will help you manage your charges, as well as, help you catch unjust charges.
Do not sign up for store cards in order to save money on a purchase. Often times, the amount you will pay for annual fees, interest or other charges, will easily be more than any savings you will get at the register that day. Avoid the trap, by just saying no in the first place.
It is wise to refrain from giving a credit card to a child. It is best to let children wait to get credit cards until they reach the age of 18, or when they can get their own. Instead, consider opening them a checking account and giving them an allowance. This will help them learn to manage a small amount of money so that they will be ready to manage a credit card when the time comes.
You should feel a bit more confident about using credit cards now that you have finished this article. If you are still unsure, then reread it, and continue to search for other information about responsible credit from other sources. After teaching yourself these things, credit can become a trusted friend.
