How to Properly Manage Credit Cards

By: Dewey Kearney

Everyone knows that a credit card is a necessity in our modern times. Have you ever tried to rent a car without one? I have and had to put a $250 deposit down, what a hassle - what if you don't have the $250 to spare?

If you use a credit card properly they are a blessing, used incorrectly they are a curse. One thing that a lot of people don't seem to have that gets them into trouble is common sense. This is not just a problem of the young; a lot of us "mature" people seem to be short on common sense also.

Our site http://www.1-800BadCredit.com has a link for credit cards and you will find every type. Lots of people get confused and think credit cards are all the same, they aren't. That's why we decided to write this article to show you what to watch for and to get a handle on your credit.



    ?Use your smarts and be cautious. If your credit is poor or even semi-poor and the only cards offered to you are with high interest rate don't go crazy in charging. If used properly a credit card can bring your credit score up, used improperly can damage it. Pay your bills on time (that doesn't mean mailing it on the due date). And if possible pay the entire bill off each month or at least a big portion of it.
    ?Understand how interest is configured on your card. A lot of people don't care about this but they should. This is the reason banks give credit cards out; it's not for your convenience, that's the way they make money. So if your balance gets high enough where the your interest is $80 per month on the balance owed and the bank sets a minimum payment of $20 and that's all you pay the next month you pay interest on the $80 interest from last months bill - see where this is going? It is a never-ending cycle and the banks love it!
    ?If you carry a large balance each month (we hope you don't) consider a balance transfer to a lower interest card or better a 0% for a set period of time. Then during that time double or triple your payments to pay the balance down or better off completely.
    ?If you have a large balance and have no immediate opportunity to pay it completely off - be pro-active. If you don't you are doing exactly what the credit card companies want. Consider taking out a consolidation loan to pay these cards off, and then get smart and don't use them except for emergencies. If you have a poor credit score you may not get the best interest rate bit I'll bet it is better than your credit card.
    ?If you have a large credit card balance but have money in the bank use that to pay your card off. This should be obvious but it isn't to some people. A friend of mine confided to me that he was $20,000 in credit card debt. He was seeking my advice of what to do. After a few questions about his finances he admitted that he had about $40,000 in a bank CD. I asked him the rate the bank paid him and the rate was ridiculously low. My advice was the obvious, take the money and pay the credit card off. His reason for not doing that in the first place was how long it had taken him to save the money. Sounds silly, yet a lot of people think the same way.
    ?There are many types of cards available - not just credit cards.

    1.If you have a hard time managing credit then use a debit card. That is tied into your bank account and if you don't have the cash available you can't make the purchase. If you are undisciplined in credit this is for you.
    2.Secured credit cards secured by a deposit but will have a credit limit. With some banks a $250 deposit will only give you a credit limit of $125 to $150. Others the limit is the full deposit. Check the fine print.
    3.Store charge cards. These are limited to just that store.
    4.Credit cards that give you a certain percentage back.
    5.Credit cards that give you other perks like frequent flyer miles. A friend of mine uses this type and charges everything BUT pays it totally off each month. He flies across the country twice a year to visit their sons but pays very little or nothing for his trips.


Whatever type of card you choose, be sensible how you use it. As long as you do this there is nothing to worry about. It's your choice, be in debt and be a slave to a bank or credit card or use them sensibly and be free.

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