The 1-2-3 of Credit Card Use

Credit Card Use and Bankruptcy

It has made shopping easy and convenient for the card holder: it can be used in just about any store (physical or online), no immediate cash payment is necessary for purchases, and payment on credit card purchases can be paid at a later date without any interrogation from the purchaser. Credit cards are a buyer's dream come through. The user just have to remember to repay what they owe the bank (generally within 14-20 days). However, the credit card dream could go sour. Credit cards have placed many in bankruptcy or financial ruin and it is obvious to see why credit cards are abused. Many who allow balances to be carried forward continually into the next month (this is referred to as revolving consumer debt) find it harder to settle their debt. Generally, about 70 percent of card holders carry their balances forward. If you don't, you're in the minority. (Well done!)

Therefore, it is necessary to take care when using a credit card. Always pay off ALL the money owed within the grace period! It makes no sense to search for bargains or sales, use the credit card and allow the unpaid balances to accumulate.  In the end you pay back in high interest rates; and above all your savings are nullified by the interest rates. And this is also no way to build a good credit card history.

Now, I believe these tips are more like rules.  You should take them seriously.

Protect your credit card and even sales receipts or slip after you use your credit card from fraud and theft. You can secure you credit card. Here are some ways you can ensure the safety of your credit card:

• Carry no more than two credit cards with you while shopping.
• Don't leave your purse whenever you out shopping, or hanging on a chair while in a restaurant.
• Don't lend your credit card to anyone, or give any stranger or telemarketer your number.
• Make sure the clerk returns your credit card after a purchase.
• Be alert of when the bank will send you a replaced credit card.
• Keep the toll-free number in a handy place to report stolen or misplaced credit cards early.
• Tear credit card receipts and secure all billing statements for your credit cards.
• Ensure your online transaction is safe (your web browser should read https, instead of http or look for a padlock icon in your web browser).
• Cut up all canceled credit cards.

There are times when the credit card is necessary and not really necessary. The credit card is very useful in cases of emergencies and you don't have the cash to pay at once. Here are some examples. It is useful for online purchases, renting a vehicle while on vacation, paying for an airline ticket, and booking a room at a hotel. It is a good replacement when your shopping and it is risky walking around with a lot of cash. However, in the absence of safety, there are times when it should not be used. Don't use a credit card for something that could be worn out by the time the bill arrives or for for purchases that could easily be made with cash .

You can minimize the cost of a credit card by doing a number of things. Seek better interest rates and annual fees on your credit card. Be aware of the grace period for paying your credit card balances. Check credit card policies – they may have some hidden fees such as late fees, cash advance fees, and penalty fees. If you see a two-cycle billing charge, you should start looking for another credit card company.

Having a credit card is rewarding, some companies reward their customer who uses their credit card with quarterly vouchers that carry a certain value.  These vouchers can then be redeemed in a number of stores.  They help reduce the price of items brought.  So, credit cards are good way to decrease the price of major items.   But despite all of this what should always be remembered is that convenience could encourage out of control spending and you may end up damaging your credit score. Be honest with yourself and keep in mind that you still have to pay for your purchases. Finally, don't spend money you don't have.

If you have any ideas to share with us on credit card use, please leave your comment in the comment box below.