How To Use Your Credit Cards Responsibly
These days, credit cards are more of a necessity than they are a luxury. They are great for a variety of reasons. They can be a valuable resource in the event of an emergency, or they can help you pay for expensive items that you can pay off slowly. However, with great power comes great responsibility. Many Americans are plagued with credit card debt because they don't know how to use them responsibly. The following article will show you exactly how to use a credit card so that you won't find yourself in a mountain of debt.
The first thing you need to ask yourself is how many credit cards you currently own. Generally speaking it is a good idea to have more than one credit card, if for no other reason than you have multiple types of payment in the event that one of your cards is not accepted at a particular location. However, it can be easy to get many more credit cards than you actually need. This can lead you to spend much more money than you have which will put you on a one way track towards credit card debt.
Perhaps the most important aspect of credit card ownership is how easily you are able to make your payments each month. If it is a struggle, chances are you are using your credit cards more than you should. As a general rule, you should be able to pay the balance in full each and every month. This will help keep your debt to available credit ratio very low which can really help out your credit score. If on the other hand, you can only afford to make the minimum payments on your credit cards, you should strongly consider not using them until you can clear the current balance.
One mistake most people make with credit cards is purchasing large items that they really can't afford. You need to ask yourself whether or not said item is really within your means. If it is, go ahead and make that purchase, however if it is not, you need to muster up a bit of willpower and restrain yourself from making a foolish purchase.
You should also ask yourself how stressed out your credit card bills make you. If you are constantly worrying about your bills each month, this is yet another indicator that your credit card spending may be out of hand. You should be able to budget how much you spend on your credit card each month, and if the amount of your bills exceed your budget, you need to make some changes. Again, stop using your cards until you pay down those balances.
It can be easy to use your credit cards irresponsibly, however you should understand the consequences of doing so. Make sure that you use the tips and advice mentioned in the article above as you get your credit card finances in order. Being responsible with credit cards is an important step towards financial success.
