Dos and Don’ts of Using a Credit Card

There are now a number of people who own credit cards. The sad thing is that almost all of them have credit card debt. As a matter of fact, statistics show that over $900 billion worth of debt is being carried by cardholders. While it may be impossible to totally escape debt since it has always been a part of society, it can always help a credit cardholder if he or she knows the do’s and don’ts of using his or her card.

Dos

• Maintain only one card as much as possible. It is not a smart move to have more than a single credit card especially if you have high credit debt already. You can cut up your other cards and keep just one card, which you can use to fund for emergencies. 
• Pay your bills on time or earlier than the agreed date. 
• Pay above the minimum amount each month. If you have saved enough money, you can pay the entire balance. This will allow you to have good credit record, which will have its own benefits in the near future. 
• Before signing up for a credit card, make sure that you have researched extensively so that you will find the best credit card for yourself. Credit cards work in different ways and there are some that are exclusively designed for certain people’s way of living.
• Take care of your card and always keep the issuer’s phone number as well as your credit card number. This can be very useful if you lose your card or if it is stolen. 
• Use your card as an investment and utilize it to boost your credit score. This will open doors for you, especially when you want to apply for a loan, buy a car, or rent an apartment in the future. 
• Get your copy of your credit report each year. This will be provided to you for free and you can use it to check for accuracy.

Don’ts

• Credit cards, especially those that offer rewards will tempt you to use them daily for your purchases. However, you should not use your card when buying clothing, food, and anything that you can easily afford. If you use it often as a substitute for hard cash, this will quickly lead you to debt. 
• Do not close your credit card just because you are in debt. This will only hurt your credit rating more, especially if it still carries a balance.
• Do not use your credit card when shopping online when you are not sure about the website’s security.
• Do not simply sign and agree with the terms stated in the credit card contract. Read and reread everything carefully. If you do not understand a terminology or a condition, you should always ask your creditor.
  Most lenders will tell you that it is essential for you to establish credit promptly. While credit cards can be very helpful, it is wise not to own a credit card unless you know how to use it wisely.