There is no denying the fact that credit cards can indeed, be part of a smart financial strategy. The important thing to remember is that they must be used wisely and deliberately. By using the ideas in this piece, you will arm yourself with the information necessary to make the types of decisions that will pave the way to a secure financial future for you and your loved ones.
If a fraudulent charge appears on the credit card, let the company know straightaway. This way, they will be more likely to discover the culprit. This will also prevent you from becoming responsible for too many unauthorized charges. All it takes is a quick email or phone call to notify the issuer of your credit card and keep yourself protected.
You should contact your creditor, if you know that you will not be able to pay your monthly bill on time. Many people do not let their credit card company know and end up paying very large fees. Some creditors will work with you, if you let them know the situation ahead of time and they may even end up waiving any late fees.
Check the details and fine print. Make sure you know exactly what is being offered in that pre-approved credit card before you take advantage of it. Understand the interest rate you will receive, and how long it will be in effect. Additionally, you may wish to know about their fees and any applicable grace periods.
If you are in the market for a secured credit card, it is very important that you pay close attention to the fees that are associated with the account, as well as, whether they report to the major credit bureaus. If they do not report, then it is no use having that specific card.
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 cards should always be kept below a specific amount. This total depends on the amount of income your family has, but most experts agree that you should not be using more than ten percent of your cards total at any time. This helps insure you don’t get in over your head.
Pay your minimum payment on time each month, to avoid more fees. If you can afford to, pay more than the minimum payment so that you can reduce the interest fees. Just be sure to pay the minimum amount before the due date.
If you need to use credit cards, it is best to use one credit card with a larger balance, than 2, or 3 with lower balances. The more credit cards you own, the lower your credit score will be. Use one card, and pay the payments on time to keep your credit score healthy!
When you are making a purchase with your credit card you, make sure that you check the receipt amount. Refuse to sign it if it is incorrect. Many people sign things too quickly, and then they realize that the charges are incorrect. It causes a lot of hassle.
Use pass codes and pins that are hard for people to decipher. It is a huge mistake to use something like your middle name, date of birth or the names of your children because this is information that anyone could find out.
Be vigilant when looking over any conditions and terms. It is common for companies to change credit terms very often. The statements that most apply to you are typically hidden within confusing words and phrases. Do not skip anything when reading, and pay particular attention to fees or rate adjustments.
One important tip for all credit card users is to make a budget. Having a budget is a great way to figure out whether or not you can afford to buy something. If you can’t afford it, charging something to your credit card is just a recipe for disaster.
Avoid the temptation to take out loans on your credit cards. It may seem to be the only way to get something paid for, but you must look into other options. Many financial advisers will tell you this and there is a reason for it. It could cost you your credit ratings later.
IF you plan on shopping around for a secured card, don’t use a prepaid one. These are not actually reported to the big credit bureaus and are really just debit cards in disguise. A lot of them will charge extra fees and are basically no more than a checking account. Apply for a true secured card that reports to the three major bureaus. This will require a deposit, though.
Stay away from high interest credit cards. Many people see no harm in getting a credit card with a high interest rate, as they are sure that they will always pay the balance off in full each month. Unfortunately, there are bound to be some months when paying the full bill is not possible.
It can be tempting to use credit cards to purchase things that you cannot, in reality, afford. That is not to say, however, that credit cards do not have legitimate uses in the broader scheme of a personal finance plan. Take the tips in this article seriously, and you stand a good chance of building an impressive financial foundation.
