Smart Credit Card Tips for January 2011
For some Americans, credit cards provide a great, easy payment method and help them earn money, sometimes hundreds of dollars a year, with rewards. For many others, credit cards are the source of grave financial problems. Here are some smart credit card tips to help you become a person who benefits from credit cards.
Never Charge More Than You Can Afford and Always Pay Your Bill In full: This should really be a no brainer when it comes to credit card usage, but so many people do not think before swiping their plastic. Before each credit card purchase ask yourself do I really need this item and can I afford it. If you can’t afford it, walk away from the purchase.
Next, always pay your credit card bill in full, each and every month. This is the number one thing a responsible credit card user does. When you leave a balance, that is when you start paying interest and in turn your credit card debt begins to grow.
Use 0% APR Credit Cards: If you have gotten yourself into credit card debt and then you should strongly consider using a 0% balance transfer credit card to consolidate your credit card debt and reduce interest expenses. If you go with a balance transfer card, make sure you cut spending and come up with a plan to pay off your card as quickly as possible.
If you don’t have credit card debt, but need to take on debt to fund a large purchase or get you through a rough period, then you may want to consider a 0% APR credit card for purchases. However, be sure to develop a plan that will let you repay your credit card debt before the 0% APR ends and the regular interest rate kicks in.
Never Think Of Your Credit Card As An Emergency Fund: This is a big mistake. You should have an emergency fund saved in the bank. Using a credit card as an emergency fund can add up to a bundle of debt that could take you years to pay off.
Choose A Rewards Credit Card That Pays You Back: Don’t just choose any credit card. Find the best credit card offer that will give you something in return. There are numerous types of reward credit cards out there for you to choose from. Some offer cash rewards, others offer travel or merchandise rewards, gas rewards and more. Choose one that makes sense for your lifestyle and let your credit card pay you. In most instances, this will be a cash back credit card.
Use Credit Card Rewards As Soon As You Can: Just about every reward card comes with fine print stating that at anytime the rewards program can change. Therefore, don’t let your rewards pile up. Use them as soon as you can in order to ensure that you can cash in on them.
Use Your Credit Card’s Extended Warranty Feature: Many credit cards offer an extended warranty on products that you purchase using their card. Check to see what your credit card offers and be sure to take advantage of it when needed. Additionally, many stores will try to sell you extended warranties on products that you may not need if your credit card already offers you the same protection. The money savings can be significant.
