In today’s modern world of personal finance, everyone has at least one credit card. Most people don’t need advice on getting a credit card since applications show up in the mail so frequently. Anyone can sign up easily for a credit card, but managing credit takes responsibility and dedication. Having fiscal responsibility when it comes to credit will pay dividends later in life, and following these guidelines to credit card maintenance is a step in the right direction.
Pay off monthly balances
Most credit cards give a grace period of up to 30 days to pay the balance off each month. Smart borrowers will use this to their advantage to float their monthly expenses, using the “free money” for several weeks and then paying it back in full.However, the ease of using plastic to pay comes with a price. It often means that people end up spending way more than they had originally planned on. Problems arise when the monthly balance is not paid in full. When this happens, interest is charged on the unpaid balance, which can compound quickly. If only the minimum payment is made, then the full amount could take years to pay off, depending on the interest rate. So learn proper credit card maintenance and keep your spending in check and your monthly balances paid off on time to avoid incurring fees.
Request better rates regularly
Credit card companies are always in an intense competition to get new customers. Often, just a call to request a lower interest rate will produce results. If you pay off the balance in full each month, then you may not be concerned with your interest rate. However, emergencies happen, and if you find yourself unable to pay the balance in full one month, the lower rate will already be locked in to help with your credit card maintenance.Restrict yourself to one credit card
Restricting yourself to one card is a sound financial decision for many reasons. First, you can see all of your spending on one statement. If you have a spouse, you can share a credit card account with a card each, and both of you can see how much is spent in total. Second, the one-card policy will discourage opening up too many cards, which can be detrimental to your credit score. Many stores want you to sign up for their "credit card" deals that offer small discounts, but don’t be pulled in. Often, these store cards have very high interest rates and the money you think you saved will quickly disappear.If you are going to carry one card, then choosing the right card can make all the difference for your personal financial situation and your credit card maintenance. Most of choosing a card is common sense, but it is easy to overlook the obvious. If you don’t pay off your balance in full, then a low-rate card would be right for you. If you do pay off your balance, then a rewards card or airline miles card is a nice perk. Also, remember to carry at least one card from a major credit card company such as VISA or MasterCard because some businesses will only take one or the other.
Keep the limit you need
Setting limits are part of every successful financial plan, and credit cards are no exception. Credit card companies will often give you a larger credit line than you actually need so you will buy more. Consequently, you may not be able to pay off the balance in full at the end of the month, resulting in high interest charges.Adding up the monthly bills that will be put on your credit card is a start. Then put in a little more money as a cushion for real emergencies. If the number you come up with is lower than your limit, contact your credit card company about lowering the limit. Also remember that some credit card companies allow an overdraft so they can impose fees. Be sure to ask your specific company about their policy.
Be aware of security measures
Identity theft is one of the fastest growing crimes in America today. Chances are good that you or someone you know has already been a victim of identity theft or fraud. Most large financial institutions, including banks and credit card companies, have security measures in place to prevent such events from taking place. Check with your credit card company about their security measures to make sure you are getting their full coverage, and if you aren't, then see how you can be placed under their protection plan.There are things you can do to prevent fraudulent activity on your card. Most of these credit card maintenance tips involve common sense, like shredding statements and being extra careful with your card in public. Other tips aren’t so intuitive, but can make all the difference: Consider checking your statement online before it comes in the mail and storing the 1-800 phone number at home in case you lose the card or your wallet. Also be wary of online buying and websites that ask for credit card information. Make sure that you're dealing with reputable companies that have secure domains online.
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