How to use Your Credit Cards Wisely
It can be impossible to imagine in this day and age: living without credit cards. We don’t even bat an eyelash at all of the things you do every day with your credit card. Everything from shopping for tube socks and airline tickets online to reserving a rental car and going out for a night of fun and not having to worry about having a wallet filled full of cash, credit cards have made life easier for millions of people around the world. But they have also ruined the lives of millions when they are misused, or, what happens commonly, when people don’t fully understand what they are getting themselves into ahead of time. Here are a few common sense tips to use your credit cards wisely and avoid the pitfalls that swallow so many unsuspecting people every year.
Credit cards are tied to a very important three digit number called your credit score. For teenagers or those that aren’t familiar with it, the whole idea of a credit score can see weird and strange, but your credit score goes a long way in determining what credit offers you get and it can also have a huge impact on things like getting a mortgage and getting financing to buy a car. You won’t have to worry about having a poor credit score if you do a few basic things. Try to pay off your entire credit card balance every single month, don’t accept every credit card offer the postman drops into your mailbox and don’t ever be late with payments. If you can follow those three easy rules, and believe me, it’s harder than it sounds, you can rest easy at night knowing your credit score is in good shape.
While it is always ideal to use cash to pay for things whenever possible, if you are buying a big ticket item, it might be smarter to use your credit card. Here’s why. If your brand new sofa or gas stove turns out to be a lemon, you can fight the merchant who sold it to you through your credit card. Once you fill out the right paperwork with your card company, you might end up not having to pay for the item at all. It is like a built in insurance policy that comes with your card.
Another major bonus that most people don’t realize they can use with their credit cards are “fake numbers” issued by your credit card company that you can use for online purchases. These alternate numbers are used in place of your actual number so that fraud and even identity theft is stopped before it starts. The issuance of these alternate credit card numbers can come with a price, so many people only use them when they are buying big ticket items that come with a hefty price tag. But if you are concerned about typing in your credit card online, there are alternatives you can explore. Contact your credit card company to see if they have a program like this.
If your credit is in fine shape, you can explore using your card for things that you never would have considered. Some folks have managed their credit so well that they have an extremely low interest rate combined with a high credit limit, so they buy their new car with their credit card! If the automobile financing people can’t give you a rate better than the one you have on your card, and the rate on your card is fixed, it might be something worth exploring.
Credit cards do not have to be all doom and gloom. They can be a valuable tool in daily life, but you have to keep a muzzle on the beast. If you let them, credit cards can take over your life, and that is a result no one wants.