If you’re like many Americans, you’ve developed a bad habit of whipping out your credit card to pay for purchases and figuring out how to pay the bill later. This is not the right way to use credit. The good news is that with a little education, you can change the way you use your credit cards. Read on to find out what to do.
If you have multiple cards that have a balance on them, you should avoid getting new cards. Even if you are paying everything back on time, there is no reason for you to take the chance of getting another card and making your financial situation any more strained than it already is.
Never give out your credit card number to anyone, unless you are the person that has initiated the transaction. If someone calls you on the phone asking for your card number in order to pay for anything, you should ask them to give you a way to contact them, so that you can arrange the payment at a better time.
Make sure that your passwords and pin numbers for all of your credit cards are difficult and complex. 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.
If you are determined to stop using credit cards, cutting them up is not necessarily the best way to do it. Just because the card is gone doesn’t mean the account is no longer open. If you get desperate, you may ask for a new card to use on that account, and get trapped in the same cycle of charging you wanted to get out of in the first place!
The key to using a credit card correctly lies in proper repayment. Every time that you don’t repay the balance on a credit card account, your bill increases. This means that a $10 purchase can quickly turn into a $20 purchase all due to interest! Learn how to pay it off every month.
Don’t think that interest rates they offer you are written in stone and cannot be changed. Remember, the credit industry is competitive between companies, and each company has different rates available to them. If you are not happy with your interest rate, call your bank and ask them to change it.
If you ever have a charge on your card that is an error on the credit card company’s behalf, you can get the charges taken off. The way you do this is by sending them the date of the bill and what the charge is. You are protected from these things by the Fair Credit Billing Act.
It is not uncommon for people to avoid acquiring credit cards because they want to give the impression that they are debt-free. It’s important use one credit card, at least, in order for you to build a credit history. Use it frequently, and make sure to pay off its balance every month. By not having any credit, a lower score occurs and that means other people may not offer you credit because they aren’t sure you know about debt.
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.
Every time you use a credit card, think about the extra expense that it will incur if you don’t pay it off immediately. Remember, the price of an item can quickly double if you use credit without paying for it quickly. If you keep this in mind, you are more likely to pay off your credit quickly.
When you receive a replacement credit card in the mail, cut up your old one, and throw it away immediately. This can prevent your old card from becoming lost, or stolen, allowing someone else to get hold of your credit card number, and use it in a fraudulent way.
If you have several credit cards, try to pay at least one in full every month. Even if there is a great deal of debt related to your other cards, your credit history will benefit from having one active card that is paid in full each month.
Go through all your credit cards and see if there aren’t any old accounts you’d be willing to close. Closing old accounts makes certain that no one can use them fraudulently. Even if an account has a balance, you can still close the account. You simply pay the balance off after you close the account.
Now that you’ve read this article, you know there’s a lot more to responsible credit card use, than just abstaining from using credit altogether. Reform your credit card habits, using the tips you have just read, so that your use of credit cards can help improve your credit scores, instead of interfering with you having good credit.