While there’s always a need to have cash in the wallet, some credit cards are also very useful. As banks ramp up fees for debit cards and regular accounts, a growing number of individuals are just using credit cards for all their electronic money storage and transactions. Keep reading to find out how to use credit cards wisely.
Understand what your interest rate will be. If you are applying for a new credit card, make sure that you are aware of what the rate is on that card. Choosing a card with a high interest rate will cost you dearly if you carry a balance. It’s always a good idea to pay off your credit card in full every month, but this may be impossible if you are paying more than you expected.
Do not forget to factor in your credit cards when creating a budget. You should have a budget for your income, so include your credit in your budget. It is important not to think a credit card is just extra money. Set aside a specific amount that you can safely spend on a card every month. Stick with this and be sure to pay it every month.
Make sure you use any credit card you obtain wisely. Give yourself spending limits and only buy things that you know you can afford. Be sure you are able to pay a charge on your statement before you make purchases with your card. If you carry balances, you are more likely to get caught in a cycle of debt that is difficult to escape.
Never lie about your income to get a card with a higher limit. If the company does not confirm your income, the results may be a limit that is way too high for your needs, causing you to spend too much money, and getting into huge debt.
Make it a point to not take all your credit cards with you everywhere you go each day. While it may be tempting to stuff all of your five or six cards into your wallet, stop and select the cards you actually use on a regular basis. These will usually include a daily charge card and a gas card. Keep only these with you; leave the others at home.
There are lots of great aspects to credit cards, as they facilitate greater financial freedom and provide purchasing power. If use the right way, they are very helpful; when used poorly, they can cause a lot of headaches. This article is loaded with advice to help consumers make wise decisions when using their credit cards.
