If you’ve never used credit cards in the past, you might be inclined to abuse them. It’s important that everyone who chooses to spend borrowed money understand that it has to be paid back, usually with lots of interest. So, it’s not a good idea to use credit cards too frequently. You also have to watch which items you purchase. With that in mind, we thought you might benefit from a guide that covers all the essentials.
Even if you have a good grasp of the basics, there is no harm in refreshing your memory from time to time. Those little rectangles of plastic have been known to get people into a lot of trouble. You want to avoid that happening to you at all costs.
Never buy items you don’t need
Some people find that credit cards increase the likelihood of impulse purchases, and that is almost certainly true. If you have no money in the bank, you can still get all the things you need by using plastic. For that reason, we think it’s wise to leave your cards at home unless you intend to use them. That way, you should be less inclined to amass high amounts of debt on silly items that you don’t need.
Always check interest rates
Different cards from different providers will come with varying interest rates. Unless you have a terrible credit score, you don’t want to apply for anything with a rate of over 20%. Those of you who’ve had debt problems in the past might have to settle for worse deals. However, using a credit card is a brilliant way of improving your credit record, and so you just need to be careful when using them.
Pay the balance in full each month
No matter how much money you charge to your credit cards, it is vital that you try to clear the balance every month. Doing that will mean you avoid interest charges, and you don’t risk getting into debt that you can’t afford to pay. While you could get in touch with Vancouver debt consolidation firms if you get in a mess, the ideal solution is to keep on top of things. The last thing you want is lots of threatening letters with red writing from your creditors. They can become rather stressful.
Do not withdraw cash
Most credit card companies will allow you to withdraw cash from ATM machines. However, you should refrain from doing so. The reason being that there are always extra charges. In most instances, you will have to pay an extra $5 for every transaction you make at a cash point. Sometimes they ask you to pay a percentage of the money withdrawn. Either way, you’re getting a pretty bad deal.
So long as you take our advice and put it to good use, you shouldn’t get in trouble when using your new credit cards. The basic rule of thumb is that you should always read the small print, and you should always remain careful when using the cards. Good luck!