5 Things You Should Know About Credit Cards
1. Use them carefully
Credit cards offer great benefits, especially the ability to buy now and pay later. But you’ve got to keep the debt levels manageable. If you don’t, the costs in terms of fees and interest, or the damage to your credit record, could be significant.
2. Choose them carefully
Don’t choose a credit card just to get freebies (T-shirts or sports items) or because there’s no annual fee. Look for a card that’s best for your borrowing habits.
Example: If you expect to carry a balance on your card from month to month, which means you’ll be charged interest, it’s more important to look for a card with a low interest rate or a generous “grace period” (more time before your payments are due).
3. Pay as much as you can to avoid or minimize interest charges.
If possible, pay your bill in full each month. Remember, paying only the minimum due each month means you’ll be paying a lot of interest for many years, and those costs could far exceed the amount of your original purchase.
4. Always pay your bill on time
You’ll avoid a late fee of about $29 or more. But more importantly, continued late payments on your credit card may be reported to the major credit bureaus as a sign that you have problems handling your finances.
And if your credit rating gets downgraded, your card company could raise the interest rate on your credit card, reduce your credit limit (the maximum amount you can borrow) or even cancel your card.
Late payment on your credit card also can be a mark against you the next time you apply for an apartment or a job.
5. Protect your credit card numbers from thieves
Never provide your credit card numbers - both the account numbers and expiration date on the front and the security code on the back - in response to an unsolicited phone call, e-mail or other communication you didn’t originate.
When using your credit card online make sure you’re dealing with a legitimate Web site and that your information will be encrypted (scrambled for security purposes) during transmission. Click here for more tips about how to protect yourself when you shop online.
Major credit card companies also are offering more protection by providing “zero-liability” programs that protect consumers from the unauthorized use of their card.
In general, only give your credit card or card numbers to reputable merchants or other organizations purchase.
All of us use credit cards in our daily life. We should use them wisely every day, therefore your post is actual and informative. And I think, that items 4 and 5 are of great importance.
Comment by wise credit card user — May 8, 2007 @ 4:32 am
A wise usage of a credit card opens you a lot of roads to more advantageous offers. If you get the card and want to take advantage of it then the points metioned in the article are of great importance.
Comment by Jenna — December 4, 2007 @ 12:18 am