Congratulations! You’ve decided to take the next big step toward building credit. In order to make sure that you continue to do so in a positive and responsible manner, we will learn about the many things to do, what to do, tips and tricks on how to successfully manage your first card and take advantage of the benefits that come with it.
Define your own personal rules for your credit card
Will this card be used in emergencies only? Travel expenses? Auto Repair? Grocery shopping trips? Gas fuel ups? Set your personal limits before starting regular use. A suite is an option – but it’s not something you want to start doing without any personal rules or boundaries. As you get a sense of how it all works, start supplementing with small purchases like gas or groceries. You want to have small purchases that you can easily pay off before the end of each payment cycle.
by type Credit cardMany offer interest-free promotions for at least 12 months. While this may seem tempting to spend as much as possible and pay it off later, you don’t want to create a habit. For example, to build a positive credit history – identify recurring expenses that you can manage to pay on time. Let’s say you spend less than $100 per month. Make sure to make a payment on or before the due date in full to establish solid financial habits.
Use your credit line healthily
Many people understand the idea that it’s not ideal not to have available credit and that it is not great to use a lot of credit. It is important that you set some ground rules and stick to them as much as possible. The ratio of your total credit limit against the credit balance can be defined as use of credit. Let’s use a real life example. Your total credit is $10,000 and you’ve used half – that’s $5,000. Based on this current scenario, your credit utilization is 50%. Ideally, you want to keep this number under the 30% threshold. I know what you’re thinking – why if that’s the credit limit I’ve been given? Using a fraction of what is available to you provides credit card lenders with confidence that you have the ability to make the payments on time each month and can exercise discipline.
As your credit usage increases over time, your credit score will likely be negatively affected if you use the total amount you earned. To prevent this from happening, it is important to ask yourself, is this helping or hindering your financial journey? Pay close attention to your posture when it comes to spending, too. Do you consider yourself an impulsive spender? Do you tend to make financial decisions when exposed to any kind of emotional duress? Lenders of any kind want to trust that you have the discipline and willpower to deal financially with any and all credit obligations, regardless of your personal circumstances.
Redeem your rewards
Depending on the type of credit card you have, you may have points that accumulate and redeem over time. Travel rewards, discounts or credits are just a few of the options you may be offered. Visit your lender’s website to investigate and stay current on all the benefits available to you. Don’t forget to download a file mint application Connect your new card to quickly get balance and card information at your fingertips.
Contact your credit card provider
In case you face any kind of financial hardship in the future, please give priority to reporting it as soon as any issues arise. Oftentimes, explaining any personal mishaps while suggesting reasonable solutions may work in your favor. Remember, avoidance is not acceptance. Make it a priority to learn about the terms and conditions of your credit cards with absolute preparation. When discussing the topic of finances, many of us are not keen on disclosing personal information (particularly to those with whom we have not established any relationship) – however, if this could result in no effect on your credit score; It’s better to be upfront and honest! Being proactive not only provides leverage, but can also ensure more favorable solutions in the end.
Get to know yourself With no basic fee
When you receive your first credit card, it will include the paperwork that will explain most if not all of the terms and conditions. While you don’t have to read the very fine print all in one day or one sitting, it’s important to review this material soon after you have the card on hand. Break it down section by section so you can see exactly what’s available to you – and note the things that can do it damage your credit. See the company’s website also for the latest information. If you have any questions, feel free to contact customer service. They are available to address any concerns and should be able to quickly correct any issues you have. Be sure to re-check if the credit card has any annual fees and learn about the interest rate terms after the interest-free period ends.
Avoid cash advance options
It might sound like a great deal to take advantage of the cash advance option if you find yourself in a crunch. However, there are a lot of intricate drawings and details that can leave you with feelings of regret, frustration, and confusion. It is better to find another alternative – every option offered by the lender is just an option. You do not have to retrieve it. The remaining financial responsibility remains to manage your money healthily, but also to know when offers do not benefit you or your financial well-being.
Review your purchases regularly
With so many ways to view your account details, take the time to review your credit card statements and/or fees online. Not only does it verify the validity of every purchase, but it also helps you know exactly where and how to manage your card. If something does not appear accurate, contact the lender immediately to resolve the issue as quickly as possible.
Marsha Barnes is a financial professional with over 20 years of experience dedicated to empowering women around the world to become financially prosperous. Financial competence and literacy is a passion for Marsha, providing practical information to clients which increases their overall confidence in their personal finances.