Do Not Let Your Credit Cards Rule You

Recession is still far from over and we need to be mindful of our expenses. It is a known fact that we cannot live without our credit card. This ever handy “plastic” has been our trusted and reliable friend for many years now, but like all friendships, this must be responsibly handled so that the relationship will always be a positive one. True, our credit cards have allowed us to make some very important purchases, but overspending can lead to our downfall and ruin. It is vital that you curb your credit card use or your spending.
For sure, credit cards are very convenient especially when we do not have cash in our wallets. Just remember not to use it for cash advances because these are not covered by the interest-free period. More often than not, you will need to pay for interest once you withdraw for the teller machines or from the counter. If cash advancing turns to be a habit, then the accumulated interest can be substantial.

Many stores offer store cards, offering you customer discounts, added warranties and extended credit. However, this might be too tempting for you to resist that every time a certain product is offered for sale to special members, you go rushing to the store. Remember that the interest rates of these store cards may be higher than credit cards. The only way you can avoid paying much is by paying your bills on time so that you will not be subject to really considerable interest charges.

In choosing your credit card, find one that suits your lifestyle especially your spending pattern. If you often travel, then a credit card that offers air mileage might be really beneficial. In cases wherein you use your card for extended credit and your income will not be able to pay the full balance each month, you could opt to pay the basic charges but with interest. If this is the most likeliest arrangement for you, then better choose a card with lower rates. Usually, cards with low rates do not offer an interest-free period.

Interest-free period are incentives given by most credit card issuers to encourage customers. If you are using your plastic for everyday expenses like your groceries or gas, you can maximize these zero interest days. Just make sure you settle the full balance every month. Doing so will give you the extra advantage of more interest free days on your purchases. You also get rewards and discounts as incentives for being prompt in your payments. However, pay close attention to the annual fees on the rewards that are being offered.

It is pretty obvious that paying on time saves you from paying on interest. Managing your finances is no rocket science. It only entails discipline and self-control. You can help yourself by sticking to your budget and match your lifestyle with your income. You are very fortunate since there are a lot of options in the market for consumers. Aside from your big name banks, there are also credit unions, building societies, community banks, shops and banks operating on the internet. Frequently, local or small-scale banks offer very low rates than the more popular and big names because they need a more extensive consumer base. Moreover, these issuers are often non-profit, which allows them to lower their rates. Doing so, you can apply for loans with discounted interest rates and receive bonuses on your time deposits. You can ever request to waive your fees on your savings account and credit cards. This particular benefit is not only for loyal customers, but also for consistent big spender. If you make a whole lot of purchases every year, some banks may actually waive your annual fee and even increase your maximum credit. This may be given as a reward, but it could also be the bank’s way of wanting you to always use your credit cards. Be very wary, therefore, of these rewards for it is an additional temptation. You can maximize this advantage by making responsible purchases and not just aim to have your annual fees reduced.

We all know that most credit card issuers are competing in getting more customers. They will offer initial discounts, great rewards and even insurance attachments. In choosing the credit card for you, do not only look at the freebies, but also make sure to compare the interest rates and their policies. Do not let your credit cards rule, but rather, rule them.

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