Owning a credit card is much of fashion these days. Getting a card is much easier and that explains why it is on high demand. The downside is that indiscriminate use of card leads to disaster. So the need is to play your cards most sensibly. Below are some effective ways to excellently manage your credit cards. The tips will be most useful for the first-time credit card purchasers as well as those who are not apt at playing card well.
Efficient management of credit card is a mirror to how responsible you are with your personal finance. If you are beginner or someone who often cross the limit of credit border, use a prepaid credit card. It is also crucial for you not to carry too much of them. One for emergency and other for balance pay off are all what you need. Carry only the emergency card and leave the other one at home unless you are not sure to buy something; this is the best way to get over temptation. However, if you are a seasoned credit card user and master at restraining impulsive buy, too many of card will not spoil your credit game.
Assess your expense limit and spend accordingly. You must not go beyond your means. It is important to know that making minimum payment on your card won’t backlist you in the credit bureau report but might throw you in deeper debt hole. Leaving any balance on credit card after the grace period is over will add to finance charges which tend to grow up very quickly.
Assess your affordable limit of debt to income ratio. 25% is the acceptable ration for most of the financial companies. The ratio implies that your debt amount constitutes only ¼ of your income per annum. For majority of the people, the ratio ranges between 10-15%.
You have to speak up for your rights. Apply to your credit card company by requesting for a lower rate or late payment fees waiver. If your credit is good in shape, the credit card providers are more likely to negotiate, rather than losing a customer.
Take time to go through your monthly credit report. Make sure all the entries are made correctly and not subjected to any hidden charges.
Too much balance on your credit card? Stop using it until the balance comes down to a manageable level.
The first time users are often confused as to which credit card they should use. Apply for what does not require you to pay annual fee. The cards that have reward offering for the members also make an ideal choice. Won’t it be nice that you enjoy privilege of membership and so are not required to make any pay-off? Added to your benefits is the bonus on offer. The credit card companies are adding innovative twist to their offers in order to get more customers in bulk. So, you will get many cards that, apart from offering bonus, also provide specified number of frequent-flier miles for spending of every dollar.