A credit card is a handy tool for making purchases in real time. All the same, using your credit card wisely can help you build a solid credit rating that you can use to secure a job, loan, or to obtain credit in a tight financial situation.

For both existing and aspiring credit card users, the following guidelines will help you use your card safely.

  • Make a wise selection: Before you apply for a credit card, you need to evaluate your spending style, spending habits, and any specific needs you have in mind and then align them to your preferred card.
  • Understand how time affects your credit card use: Think of it in the perspective of a loan. The longer you take to pay off, the more you are likely to pay in accumulated interests. For example, 3000 dollars at 19 per cent rate will yield only 75.40 in interest. If you carry it forward for five years, you will end up paying 1500 dollars in accrued interest. If you want to remain safe with your credit card, avoid transferring balances. Monthly payoff is ideal to relieve you of any accumulated figures that keep increasing as you delay payment.
  • Are there penalties and how much? Most credit card issuers impose penalties on users who default payment deadlines or exceed their credit limit. Find out from your issuer if they allow a grace period to settle the default payments. Once you have the right information, you should plan yourself to ensure that you meet deadlines as required.
  • Just get two credit cards: While you can have as many cards as you wish, it is advisable to have just one primary credit card and a backup that you can use in case your primary account is compromised. Too many credit cards can affect your credit rating since the money is available in your name, even if you do not use it.
  • Keep monitoring your accounts: Credit card usage has its share of challenges and you should always be on the lookout for any strange thing that may happen to your account. Check for new charges, fraudulent entries, and any charge that is forgotten.

In the end, it is essential to establish a good credit history with your card. Financial reputation is important and even with your credit card you need to remain disciplined in order to build a strong foundation.