You may have avoided credit cards because you have heard that they can get people into trouble or that responsible financial management means never using a credit card. However, if you use credit cards properly, you can boost your credit score, so you don’t want to avoid credit cards out of fear. Read on to learn how to use credit cards appropriately.
Do not use your credit card to make purchases or everyday items like milk, eggs, gas and chewing gum. Doing this can quickly become a habit and you can end up racking your debts up quite quickly. The best thing to do is to use your debit card and save the credit card for larger purchases.
Obtain a copy of your credit score, before you begin applying for a credit card. Credit card companies will determine your interest rate and conditions of credit by using your credit history, among other factors. Checking your credit score before you apply, will allow you to make sure you are getting the best rate possible.
Do not sign up for a credit card because you see it as a way to fit in or as a status symbol. While it may seem like fun to be able to pull it out and pay for things when you have no money, you will regret it, when it is time to pay the credit card company back.
If you have multiple cards that have a balance on them, you should avoid getting new cards. Even if you are paying everything back on time, there is no reason for you to take the chance of getting another card and making your financial situation any more strained than it already is.
If you wish to have credit cards but you have no established credit, get a co-signer. This can be a family member or friend with existing credit. They are required to state their willingness to assume responsibility for outstanding balances if you fail to pay. This is the perfect way to obtain your first card and start to build positive credit.
Always read the terms and conditions of your card before using it. When you make your first purchase on a new credit card, the credit card company will usually consider your purchase as your acceptance to their terms. Although some of this agreement may be in fine print, it is very important to thoroughly read all sections.
When you make online purchases with your credit card, always print out a copy of the sales receipt. Keep your copy at least until you receive your monthly statement, to be sure that you were charged the authorized amount. If they mis-charged you, first contact the company, and if they do not fix it, file a dispute with your credit company. This will ensure you don’t get overcharged for your purchases.
As you can now see, you’ve been doing yourself a disservice all these years by avoiding credit cards. Used correctly, credit cards aid your credit score and make it more likely that you will be able to get that mortgage or car loan you need. Use the tips that you have just read, in order to help you pick the best credit card for your needs.