Follow these simple tips on how to use a credit card and manage your expenses more efficiently. These simple ways will allow you to remain debt free.
1. Be Careful When Opening Cards
Only open a credit card at a retail store if you shop there often. When a store runs a credit check to see if you qualify for a card, it shows up on your credit report, even if you ultimately decide not to open an account. Racking up a list of inquiries from several different retail stores can cause your credit score to drop.
2. Automate Payments
In order to maintain a solid credit score, always pay your balances by the due date. Making your payments late will negatively affect your score and cost you additional fees. Establishing automatic payments through your bank can be a great way to streamline the process and generate savings.
3. Premium Cards
To help ensure you do not over pay for a premium credit card, double check whether the card has an annual fee attached to it. If you are the owner of a platinum card, or a black card, the annual fees can be up to $1000. If you do not need a premium card, don’t get one.
4. Be Upfront About Financial Situation
If your financial situation takes a turn for the worse, it is important to notify your credit card issuer. If it is possible that you will miss your next payment, you may find that a card issuer will help by allowing you to pay less or pay in installments. This may prevent the card issuer from reporting you late to the credit bureaus.
5. Keep A Close Eye On Terms
Keep a close eye on any changes to your terms and conditions. Often, card companies change these terms without informing people. Oftentimes, the things that will affect you the most are written in legal language that can be difficult to translate. Remember to read through all that might affect you, like adjustment rates and additional fees.
6. Request Interest Rate Reduction
It is possible that your interest rate can be reduced, so do not think that you are stuck with the rate you were given. The credit card industry is a competition, and all credit card companies have different interest rates that they can use. Make a request to your bank to change your current interest rate if you don’t like it.
7. Verify All Charges
Make sure to verify all charges and fees that are associated with a credit card that you are considering, instead of just focusing on the interest rates and the annual percentage rate. Other fees like service charges and cash advance fees can quickly add up.