How to Make Your Charge Card Benefit You

There is a lot of hype about the downfalls of owning a credit card and the debt that comes with it, not to mention the outlandish interest rates that keep us hopping. Is having a charge card a bad thing? It doesn’t have to be. It’s really a matter of who controls who - does the credit card own you or do you own it? Here are a few suggestions on how to make your credit card a benefit to you.

Instructions

Difficulty: Moderately Easy

Things You’ll Need:

• credit card

How to Make Your Charge Card Benefit You

1. For your own safety, your credit limit on a rotating credit card should never be more than you can pay off in one month. We often use our cards for large purchases but our goal should be to pay the card off as quickly as possible to avoid the ongoing interest charges.
2. When you use your credit card to purchase something, make sure that you pay the entire purchase off before the due date on the invoice. This way you won’t have any interest charges and the only money you’re paying out is the amount for your purchase.
3. If you use your credit card for all your gasoline purchases throughout the month, you have two benefits. First, if you pay it off before the invoice is due, you won’t have to pay any interest charges. Second, by using the card you avoid bank charges from using your debit card and the benefit of not having to carry money around.
4. Credit cards make on-line purchases quick and easy. Again, paying the balance off before the due date on the invoice prevents you from paying interest charges.
5. Credit card statements provide an accurate account of what you have spent money on, and this helps us to keep in control of our spending. This is better than cash because with cash, we tend to spend it and not account for what it was spent on.

Tips & Warnings

• When need to be careful not to lose control of our spending and let the card get maxed out because then we are paying repeated high interest charges until it gets paid down. The problem is that once it’s run up to max, it becomes extremely difficult to pay off and the cost of owning the card turns us into its slave.