7 Credit Card Do's and Dont's

Credit cards are a very convient way to pay for things without having to carry cash around. Unfortunately, many people mistakenly view credit cards as a substitute for not having money. The following tips provide some basis guidelines as to how best to use your credit card - without risk.

Do’s.

1. Understand the difference between things you NEED and those you WANT. The plan for those purchases using a priority system. You need the essentials, and you want everything else. The ability of making a distinction might help you plan wisely.
2. If you find yourself in financial difficulty, ALWAYS talk to the credit card issuer who might be able to re-schedule your payments for a short period. Do not risk a default - it builds an unfavorable credit history that will work against you next time you need a mortgage or other line of credit.
3. Unless it is an emergency, STAY within your credit limits. Most card transaction systems prevent you making a purchase that extends your credit card spending over the credit card limit. However, if you set yourself a manageable spending limit based on your ability to repay the credit, make sure you stay within 30 percent and/or you can get below your self imposed limit within 3 months.
4. Watch our for more favorable credit card deals in the mail - approach your issuer to equal or better the deal. They want to retain you as their customer, so they will listen.

Dont’s

1. Don't use your credit card to make household purchases unless you KNOW you can pay them off at the end of each month. It’s expensive in the long run. See risks of using credit cards.
2. Don't be tempted to only pay the minimal amount each month just because the credit card company allows you to. It is their way to extract exorbitant interest charges from you. The quicker you clear the debt the better.
3. Don't use the credit card to purchase things you can’t afford.

Next: Getting A Credit Card When You Have Bad Credit History

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