Tricks And Tips That All Credit Card Users Must Know
Credit card use can be a tricky thing, given high interest rates, hidden charges and changes in laws. As a consumer, you need to be educated and aware of the best practices when it comes to using your credit cards. Read on for some valuable tips on how to use your cards wisely.
Before you choose a credit card company, be sure that you compare interest rates. There is no standard when it comes to interest rates, even when it is based on your credit. Every company uses a different formula to figure what interest rate to charge. Be sure that you compare rates, to ensure that you get the best deal possible.
Do not lend your credit card to anyone. Credit cards are as valuable as cash, and lending them out can get you into trouble. If you lend them out, the person might overspend, making you responsible for a large bill at the end of the month. Even if the person is worthy of your trust, it is better to keep your credit cards to yourself.
To verify you are not paying for premium features you don't need on your credit card, see if the card company charges an annual fee for it. Depending on how exclusive the card is, a platinum or black card may carry a fee of $100 to $1000. If you don't need an exclusive card, keep this in mind and avoid the fees.
Credit card companies state your minimum payment and hope you will not pay more so they can collect more interest on your balance over time. Always pay as much as possible in excess of the minimum payment. Paying off your balance faster helps you avoid expensive finance charges over the life of your debt.
To make the best decision regarding the best credit card for you, compare what the interest rate is amongst several credit card options. If a card has a high interest rate, it means that you will pay a higher interest expense on your card's unpaid balance, which can be a real burden on your wallet.
If you are about to start a search for a new credit card, be sure to check your credit record first. Make sure your credit report accurately reflects your debts and obligations. Contact the credit reporting agency to remove old or inaccurate information. A little time spent upfront will net you the best credit limit and lowest interest rates that you may be eligible for.
If you are going to make purchases over the Internet you need to make all of them with the same credit card. You do not want to use all of your cards to make online purchases because that will increase the chances of you becoming a victim of credit card fraud.
The credit card that you use to make purchases is very important and you should try to use one that has a very small limit. This is good because it will limit the amount of funds that a thief will have access to.
We all know what it's like. You get another piece of unsolicited "junk mail" urging you to apply for a shiny new credit card. Often times you won't be interested in getting a new credit card right them. Tear up or shred credit card offers before disposing of them. Avoid tossing it in the garbage intact because the application might contain some confidential information.
Prepaid cards should be avoided when you are seeking a secured credit card. These are, in fact, debit cards, and big credit bureaus take no notice of them. Many prepaid card providers also charge extortionate fees for each transaction. Choose a secured credit card (which requires a deposit) instead. The company will report your account to the credit bureaus and benefit your credit score.
Hopefully, this article has provided you with some helpful guidance in the use of your credit cards. Getting into trouble with them is much easier than getting out of trouble, and the damage to your good credit standing can be devastating. Keep the wise advice of this article in mind, the next time you are asked if you are paying in cash or credit.
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