Wednesday, August 14, 2013

Great Tips on Dependable Credit Card Usage

In order to get a good deal on your credit card, it’s very important to know few things about credit. But if you ignore to know then it might be very costly for your finances as well as your credit ratings. Even if you know the minimum of the basics then that will also help you a lot. If you have the knowledge on how credit and credit card works then it will be easy for you take the right decision on selecting and using your credit card. In this article we’ll present few great tips which will help you to select the right credit card for you and also guide you through the usage.

Types of Credit Cards:


Though all the credit cards look similar, but as far their terms and conditions are concerned they are different from each other. Many varieties of cards include standard or plain-vanilla cards that contain only standard components. These types of cards don’t offer you cash-back, rewards etc. Student credit cards are intended for young college students. Reward credit card for those people who buy most of the things on a credit card and clear the balance each month. Secured credit cards are for those people who have got into credit card trouble in the past and not eligible to quality for the traditional credit card. Once you are familiar with the different types of credit cards then it will be very easy for you to choose the right credit card for you.

Stick to a budget


The ease of using a credit card could result in the economic downfall since you may wind up paying more than you possibly can afford. That’s why it is very important for you to stick to a budget. If you have started to use a new credit card then, maintain a regular monthly control for the expenses.

An alternative way to monitor the paying would be to register the contact number while using credit card. Each time you swipe the card, you will get a notification in your cell phone, stating your expenditure amount and your remaining balance in your card.

Monthly statement of credit card:


Every month you’ll receive a billing statement of your credit card. Billing cycle is normally between 21 to 29 days. Each month your bank issues a transaction statement and sends the detail to you of that current billing cycle. If there is an outstanding balance in your account then you need to make a minimum payment to reduce the balance or else you can clear the total outstanding balance as well. If you don’t use your credit card for several months then you might not get a billing cycle.

Start with a minimum credit limit and don’t increase:


When a bank provides you with a credit card, it will eventually set a credit limit based on your pay. You may tend to boost this limit to advance more costly expenses. But it's preferred not to do so, at least till the time you are more confident on credit card usage. Though bank may increase your credit limit but at the end of the day it's you who have to pay the amount.

So, unless your monthly earning is increasing stick to a minimum credit limit. Once you realize that you have reached the credit limit then it’s preferred to use cash rather than using your credit card.

Pay back the amount on time:


It is very important to pay back the full credit amount on time. Excellent credit rating is made on on-time payments along with excellent financial debt management. Hence, you should use your credit card to a certain extent which you can easily afford to pay back.

The above mentioned great tips will surely help all the credit card beginners to know about the credit cards and its usage.


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