Now I have to be honest with you, I’ve not always used credit cards wisely. In fact, I’ve charged way more than I should have at times and have gone broke doing this. But I do think that through the years I am learning a few things about credit cards that I would like to share with my readers. These are just ideas that I am starting to apply to myself and hope that it might be helpful for you. I can tell you, I have already started training my two sons about credit cards as well.
First, know why you want to have credit. If you do not know the reason for having credit, don’t start applying for credit cards and using them. For most, building a line of credit is to show that you are wise enough with money that you pay off your credit cards at the end of every billing cycles and you are always current. This will help those who are planning to give you a mortgage for a home if you are unable to pay cash for the home or even if you are planning on purchasing a car and are unable to pay cash for the car. This helps creditors know that you are faithful in meeting the obligation of paying your bills.
Second, make sure that you read all of the material on a credit card before you apply for it. This means that you should read ALL the fine print. This will help you to know what the introductory interest rate expires and what happens if you make a late payment and the introductory deal expires from this action. The deals that banks make for you to have their credit cards sound really good but you need to remember that it is best for them…especially when you are carrying a rotating balance and not paying the cards off every month.
Third, use your debit card or cash if possible. Use your credit cards for emergencies in the case that you do not have the cash to pay for whatever it is that you want. It is better for you to use your debit card because you will not be able to spend anymore than what is in your account. And it is helps you to avoid buying things you really don’t need because you will keep better tabs on what you have.
Finally, think about what it is that you want to purchase. Don’t just spend money because it is helpful for your psyche. It’s better to plan for what you want and to pay cash or using your debit card then binge buying using a credit limit and being stuck with bills you cannot afford to have.
These are some lessons I’ve been learning. I hope this is helpful. Remember, your credit history matters and if you don’t keep your credit history in good shape, it won’t matter what you want to purchase…you’ll be denied.
Be wise with credit cards. Know what you want and why you want it.