Tips to Manage Your Credit CardsMarch 5, 2011 - 8:15 am
Many people fall into credit card trouble because they’ve mismanaged their credit cards. The task of keeping up with all your different cards and payments can get difficult with the more cards you have. Even if you have just one card, taking steps to manage that credit card can go a long way in helping you stay out of debt and keep a good credit score.
Know Your Payment Due Dates
Credit card law now requires payments to be due on the same day of the month each month. So, if your Citi Visa is due on the 5th this month, it will be due on the 5th next month and each month after that. You don’t have to try to manage all your card due dates in your head. Instead, make a list with all your cards and their payment due dates and put it in a place that you will see it all month long. The list doesn’t have to be for just credit cards. You can put all your other bills on it too.
Know Your Balances and Credit Limits
Have you ever gone to make a credit card purchase and couldn’t remember if you had enough available credit on that credit card? You can eliminate that problem by checking ahead of time. If you know you’re going shopping, decide which credit card you’ll use before you go into the store. You can check online or call the customer service number on the back of the card. Once you check your balance and available credit, you’ll know if you have enough room on that credit card to make a purchase and how much that purchase could be. That will keep you from going over the limit and triggering late fees.
Know Your Interest Rate
Since you already have a list of your credit cards and due dates, you might as well add each credit card’s interest rate to that list. Interest rate is another factor that comes into play when you make a credit card purchase. If you’re charging something you know you’ll be paying over time, then use the credit card with the lowest interest rate as long as that credit card has enough available credit.
Keep Your Balances Low
Ideally, you’ll pay off your credit card balances at the end of every month. Keeping a low credit card balance across all your credit cards will make it easier to pay the full balance. Review your budget to see how much you can afford to charge in total and remember that this amount applies to all your credit cards, not just one. Not only does a low credit card balance make it easier to pay off your debt, it also helps your credit score. Thirty percent of your credit score takes into account the amount of debt you have on your credit cards. Keeping a low balance – below 30% of your credit limit – will help you build a good credit score.
Managing credit cards is essential for everyone who has a credit card. If you’re having trouble managing your current credit cards, don’t apply for a credit card until you can handle the ones you already have.