Credit card purchases are a convenient way to shop, especially with the advent of online shopping. With countless options and helpful customer reviews, shopping from home can save you time and money, but online purchases can also harbor security lapses or unnecessary spending on items you don’t need. Make sure you understand your rights and responsibilities as a consumer. Staying on top of your finances will ensure a pleasant and enjoyable shopping experience.
Tips for using your credit card:
1. Review your monthly statement as soon as you receive it. Contact the creditor right away if you notice errors, especially if you see a charge for an item you did not purchase.
2. Pay off your balance in full each month to avoid paying interest. If you can’t do that, pay as much principle as you can, as soon as you can. Interest rates can rapidly inflate the cost of your spending habits.
3. Pay on time to avoid late fees and avoid having late payments on your credit report. If you cannot pay your credit card bill by the due date, call the creditor right away. The creditor may waive the late fees or be willing to make other payment arrangements.
4. Try to minimize how much you owe in relation to your credit limit. This is your credit utilization rate. Some experts advise using no more than 30% of your credit limit while others advise using no more than 20%. Keeping balances at or below those percentages may not always be realistic, but it helps to use as little of your credit limit as possible.
5. Know that using a high percentage of your credit limit at any point in the billing cycle can negatively affect your credit scores. This is true even if you regularly pay off your entire balance every month.
6. Keep a record of important information about your credit cards. Address lost or stolen credit cards quickly. Store your account numbers, expiration dates, the website address, and telephone numbers of each creditor in a safe place, separate from your credit cards, so you can report a loss or theft quickly and easily.
7. Read the rules that govern your account (the cardholder agreement). You can access the information online or ask your creditor for a paper copy if you do not already have one.
8. Read all notices and information you receive from the creditor. They may be telling you about an important change to your account. If you signed up during a promotion, interest rates can change before you know it. It is always a good idea to know how much your credit card company is charging for an unpaid balance.