Having a credit card makes it easier for people to build good credit histories and take care of their finances. The key is understanding how credit cards work and making wise spending decisions. You will be able to make better choices and safely use your credit cards after reading the basic information in this article.
Never use your credit to buy things that are out of your price range that you cannot pay off. It is acceptable to use your credit to make purchases that you will be able to pay off later, but do not make large purchases that could put you in a financial bind.
A lot of companies offer large bonuses for new customers. Make sure that you understand everything that is written in fine print since many credit card companies have specific terms you need to adhere to in order to get bonuses. For example, you may need to spend a specific amount within a certain period of time in order to qualify for the bonus. Be sure that you’ll be able to meet the requirements before you let the bonus offer tempt you.
Make your credit payment before it is due so that your credit score remains high. A payment that you make too late, will lower your credit score, while costing you a lot of money. You can avoid being late by putting your credit card payments on an automatic schedule.
You want to try and avoid the fee for going over your limit just as much as late fees. Both are pretty steep, and the cost of going over the limit can not only affect your wallet but also your credit report. Monitor things closely, and never exceed your personal limit.
Always sign the back of any new credit card as soon as you receive them. A lot of people forget to sign the back of their charge cards and this can have bad consequences if a credit card is stolen. A lot of places need a signature so they can match it to your card, which makes it safer to buy things.
If you cannot afford something, don’t put it on a credit card. The fact that you desire a new television is not sufficient justification for charging it on a credit card. It costs a lot of interest, and that makes monthly payments pretty much impossible. Leave the item in the store and think about the purchase for at least a day or two before making a final decision. If you still want to purchase it, the store usually has in-house financing that will have lower interest rates.
When you buy with a credit card on the Internet, keep copies of your receipt. Retain the receipt until the bill arrives so you can ensure that you were charged the proper amount. If it differs, file a dispute of charges with the company as soon as possible. By keeping up with your payments and receipts, you’re ensuring that you won’t miss an overcharge somewhere.
You should never jot down your password or pin number, regardless of the circumstances. It is vital that you know your password, and that you’re the only one who has access related to it. Writing your pin down and placing it in a similar area where you place your card is not a good thing to do.
Never give out a credit card number over the phone if someone else initiates the request. Scammers commonly use this ploy. Only allow those that you trust to have your credit card number. Never give your number to random people who call your home. You never know who is really on the other end of that line.
Too many people erroneously believe that it is a good idea not to have any credit cards at all. It’s important to have, at the very least, one card, so you are able to build your credit. Use the card, then pay the balance off every month. If you do not use any type of credit, your score will suffer, and future lenders may not have any measure of your creditworthiness.
As you have seen, credit cards can be a great help in building or re-building a person’s credit, as well as a tool to help one learn to make wise choices with their money. Knowing the details of each card is of the utmost importance, as ignorance can breed debt. Understanding the fundamentals of credit cards is important for consumers who wish to make educated decisions.