Use Your Credit Cards Responsibly

With Americans going deeper into debt every day, usually thanks to uncontrolled use of credit cards, you may wonder if there is any good way to use a credit card. If so, how can you control your credit card debt, as opposed to letting it control you?

The first step is self-control. If you can’t discipline yourself to make wise decisions about credit card use, then don’t get a credit card. You’re just asking for trouble. This means that you have to be brutally honest with yourself. If you’re not judicious with the money in your bank account, how can you be judicious when it comes to the use of someone else’s money, which you’ll have to pay back with interest? Don’t fool yourself. Be honest and be willing to make the decision not to get a credit card if you feel that you won’t be able to control it.

That being said, there is a difference between thinking you can handle a credit card and actually handling one properly. It can be like a loaded weapon if you’re not careful. But, if you’re wise, it can be a valuable tool that can reward you for proper use. Here are a few tips for getting the most out of credit cards:

•Shop Around: Don’t just fill out any application and hope for the best. Look for the best deal. Make sure that the card you get will fit your lifestyle and your financial management style.
•Pay It Off: Never charge more than you can afford to pay off within 30 days. With most credit cards, you get a grace period that allows you to pay off balances without being charged interest.
•Leave Home Without It: Don’t carry a credit card with you. If you have to go all the way home to get the card in order to make a purchase, it will force you to think about the purchase before you make it. This can reduce the number of impulse purchases you make.
•Look for Rewards: If you can, try to find cards that offer rewards for using them. Some cards offer free gasoline, frequent flier miles, cash back or other incentives for using the card.
•Pay Your Bills on Time: Late fees can cost anywhere from $20 - $40 for one late fee. This adds itself onto your balance and if you don’t pay it off immediately, you will pay interest on the late fee as well. Late fees can put you in the whole very quickly and many credit card companies may increase your interest rate the very first time you are late with a payment. Needless to say, it can be very costly to be late on your payment. It doesn’t look good on your credit score, either.
•Don’t Go Over: Some cards may allow you to go over the credit limit you’ve been given to some extent. But, when you do this they may hit you with $20 - $40 charges, just like late fees. Again, this is bad news. It also does not look good on your credit report to have maxed out credit cards.

Credit cards can very quickly get you into a lot of trouble. But, if you avoid impulse purchases, pay them off every month and make your payments on time, they can reward you for purchases and help you build up a solid credit score. Just use your cards wisely and remember that you should be in control of your credit, not the other way around.