Customer advice itself is a commodity, especially when dealing with credit cards. The article below discusses some of the best ways to use credit cards and avoid pitfalls. Many people have cards that do not even understand the proper way to use them and this leads to bad debt.
Do not close any credit card accounts without finding out how it affects your credit report. Depending on the situation, closing a credit card account might leave a negative mark on your credit history, something you should avoid at all costs. It is important that you keep your oldest credit cards open, as they account for your credit history.
In order to maintain a high credit rating, ensure you are paying off your card payment on the day that it’s due. Late payments can damage your credit score and often involve costly fees. If you set up an auto-pay schedule with your bank or card lender, you will save yourself money and time.
Don’t buy things that you can’t pay for on a credit card. Even though you really want that new flat-screen television, credit cards are not necessarily the smartest way to purchase it. You will end up paying a lot of money in interest charges, and the amount you need to pay every month might be too much for you. Make decisions only after thinking them over for a couple of days. If you still want to purchase it, the store usually has in-house financing that will have lower interest rates.
Public computers should never be used to buy items with your credit card. Your card information will be on these computers, such as the ones in the public library or in coffee shops. Entering confidential information, like your credit card number, into these public computers is very irresponsible. When you are making purchases only do so from your own personal home computer.
Never give in to the temptation to allow anyone to borrow your credit card. It may be a friend that needs it for something, but it is never a good idea to give your credit card to anyone. This can lead to your friendship being ruined. Or it can result in over the limit charges should your friend charge more than you authorized.
Those with imperfect credit may want to think about getting a secured card. They are simply credit cards for which a deposit is necessary to guarantee payment. Basically, you borrow your own money, paying interest to be able to do so. This is not a perfect situation, but it can help rebuild damaged credit. Stick with reputable companies when applying for a secured card. They might eventually offer you a card that is unsecured which is even better.
Although it can be tempting to make payments right after purchasing something, avoid this. Instead of paying right away, only pay when your statement comes in. Then you can pay the full balance to be done with it for another month. This will help to improve your credit rating.
Never close the account. While you may think a closed account will lead to a credit score rise, this is, in fact, incorrect. The reason behind this is that you will be reducing the total mount of credit you are given while still owing the same amount. The ratio between the two will look worse as a result.
If you are searching for cards that are secured, steer clear of prepaid cards. This is nothing more than a debit card and won’t affect your credit rating. They do not offer any advantages over a checking account and may charge additional fees. Apply for a true secured card that reports to the three major bureaus. This will require a deposit, though.
Don’t lie about your income to get a higher limit credit card. Companies that offer these cards may not verify income, which means you will get a high limit card, but you may spend more money and incur more debt.
Hide your credit cards in your wallet, behind the debit cards is a good trick to avoid using them by mistake. This way, if you are in a rush and not paying attention, you are more likely to slide out your debit card instead of charging something you did not intend to.
Before providing your child with a credit card, make sure that he or she is responsible enough to have one. We all know that it’s hard to tell your kids no for anything, but when it comes to credit, they’re dealing with lifelong consequences. If children are not ready to repay their debts, then having a card should be out of the question.
Before applying for a secured card, take time to read all of the small print and be sure that you fully understand the terms of the card. Any deposit you make initially may be overshadowed by fees, resulting in a low credit limit.
If you believe your credit card has been stolen or lost, it is necessary to contact your card issuer right away. If thieves use your card before you call to report it as missing, you could be held liable for the charges. Once you report your stolen card, the company won’t charge you for its future use.
In conclusion, getting in trouble with your credit cards is far too simple. One or two expensive purchases that you cannot afford can severely damage your credit rating and send you to the poor house. The advice you have read here can help you avoid these problems and keep your credit history healthy.
