Key Credit Card Factors to Consider
A credit card can be an asset to your lifestyle, but if not handled carefully it can become a liability, especially if you find it so convenient and easy to use that you lose control of your spending.
This short guide will help you understand how you can use your credit card so it works to your advantage, not against you.
Advantages
A credit card can:
- Offer free use of funds, provided you always pay your balance in full, on time.
- Be more convenient to carry than cash.
- Help you establish a good credit history.
- Provide a convenient payment method for purchases made on the Internet and over the telephone.
- Give you incentives, such as reward points, that you can redeem.
Disadvantages
On the other hand, credit cards can:
- Cost much more than other forms of credit, such as a line of credit or a personal loan, if you don’t pay on time.
- Damage your credit rating if your payments are late.
- Allow you to build up more debt than you can handle.
- Have complicated terms and conditions.
What is a credit card?
A credit card is more then a simple piece of plastic, it is first and foremost a flexible payment tool accepted at 30 million locations worldwide, and if the card balance is paid off every month, then no interest is charged on purchases made so, essentially, short-term credit is granted without the consumer paying any interest.
Among its many features it provides:
- Access to unsecured credit (no collateral required against amounts charged)
- Interest-free payment from time of purchase to the end of the billing period
- Instant payment of purchases, allowing for instant receipt of goods and services
- 24/7 access
- Fraud protection
However before you decide to use your credit card, carefully consider all of the factors and weigh them against your personal needs and values.
What about credit card control?
Handling money and credit cards wisely is a talent few of us are born with. But it is a skill that can easily be learned. The place to start is with budgeting.
What is a Budget?
It’s simply an organized way of managing your finances, basically, it gives you an overall picture of where your money is coming from, when it’s coming in and how it’s being spent. A budget should be flexible, changing according to your circumstances.
Why Budget?
Budgeting helps us achieve short-term goals like paying the monthly bills on time; it’s also for longer-term financial goals like buying a home, a car, paying for an education, a wedding or a holiday. When you take control of your financial affairs, you’re more confident about the future.
A budget is key to financial control. It gives you a “Polaroid picture” of where you stand financially and where you’re heading.
Credit card control tips:
- Use a low or no-fee credit card and save on the annual fee that some companies charge.
- Only charge to your credit cards what you can pay off in full when the bill comes.
- You might not use your credit card as much if you start believing that you have to pay off your entire balance at the end of each month.
A good way to help to reduce what you pay on your credit card is to search for a card with a lower interest rate. Many financial institutions now offer at least one of these types of cards. Remember that when you take a cash advance on your credit card, the interest starts accumulating immediately and not on the due date of your credit card bill. Also keep in mind that if you make only the minimum monthly repayment you may never get out of debt.
Conclusion
The main advantage of having a credit card is convenience, but if you’re not good at budgeting and managing your finances, the over-use of credit cards can leave you with a debt that’s very difficult to pay back.
About the Author: Lance Rush offers tips on normal wbc, reticular veins and other information, visit the Health And Nutrition Tips website.
How Credit Cards Can Protect You
Using credit cards can strengthen your personal protection. While appearing to be the same, there are significant differences between credit cards and debit cards. A big Caveat…
However, this strategy does come with a big caveat.
* If you have the discipline to pay off your balance each month, then this strategy is for you.
* If you’re prone to over-spending and need to limit temptation, this may not be the best strategy.
Only you can decide… it’s your money.
It comes down to liability and control. About credit cards…
If you lose a credit card, your liability is limited to $50 and you have 60 days to make a written claim to your card company.
With a credit card, you’re using OPM or other people’s money to make purchases. At the end of the billing period, you receive a statement and pay back the lender.
The card company makes money from this service by 1) charging you interest on any outstanding balance, and/or 2) annual and other fees.
When you use your card, you’re increasing the amount of control you have over a specific transaction.
For instance, if you have a dispute with a merchant. You may choose to call your card company and tell them not to pay the merchant and to remove the charge from your account.
In many cases, the card companies will withhold reimbursing the merchant until the matter has been resolved.
At no time was your money at risk until you were satisfied with the outcome. The merchant however, was pressured to resolve it to your (and the credit card company’s) satisfaction so he could get paid. What about debit cards…
With debit cards, the limit of your liability goes from $50 the first two days it’s lost, to $500 up to 60 days from being lost, then your liability is limited by your account balance.
With a debit card, the money is taken out of your account within 1-2 days, and sent directly to the merchant. If you have a dispute, the merchant is less motivated to help you because he already has your money.
He’s in the power position and controlling your money while you try to resolve this issue. You have to be careful not to upset him too much or he’ll just keep your money and write you off as a customer.
Final Note: If you can, use your credit card as much as possible. For those a little nervous about this, when you get home from purchasing something, immediately transfer that amount of money to your credit card company or another account you use exclusively to pay your credit card bills.
About the Author: David Koons How do protect those you care about? Discover the “2 Factors Essential To Your Personal Safety” and learn the simple steps you can take immediately to protect and, if necessary, defend against any threat. David Koons is an expert in self defense, personal protection strategies and former member of an elite military special forces unit. Lean more and discover the 2 Factors here: http://protectanddefendinc.comDon’t Swipe Recklessly During the Holiday Season!
When November rolls around every year, stores begin advertising like crazy, and people start getting in the mood to shop. Just about everyone has a list of people for whom gifts must be purchased, and the only way to accomplish this is obviously to spend money. Unfortunately, many people see the holiday season as a good excuse to put all purchases and expenses on a credit card because they don’t have enough cash on hand to pay for everything all at once.
The holiday season, however, is no reason to rack up credit card bills that can’t be paid. Using some smart shopping tips and other creative ideas can help prevent a person from spending too much money that they don’t have.
As long as the holiday season is celebrated in moderation each year, people can rest assured that credit card debt will not haunt them for the rest of their lives. This is in no way saying that credit cards are not useful tools and should not be used while shopping. It is, however, saying that credit cards should not be abused during November and December each year.
It’s very easy to go to a shopping mall and want to buy everything that is seen on the shelves. With a credit card, it’s easy to over-buy things that aren’t really needed, because using plastic to buy things doesn’t always seem like real money is being spent. At times, credit card spending can get out of control very easily. To help curb this, a list of what needs to be bought on a shopping trip should be written before arriving. Once there, even though things are tempting, only items on the list should be purchased.
Another useful tip when it comes to using a credit card while shopping for gifts next holiday season is to write down everything that was purchased using the card. Making a list (and checking it twice!) will allow the credit card holder to keep track of how much was charged, and how large the bill will be at the end of the month. Many people are shocked when they receive their credit card statements in January of each year, because they are unaware that they charged so much during the months of November and December.
Something to keep in mind each holiday season is the fact that “more expensive” doesn’t always mean “better” when it comes to gifts. Many people would much rather receive a homemade gift, a home-cooked meal, or something small as opposed to an expensive items that may not even be liked or enjoyed by the recipient. Using creativity and the imagination when choosing gifts can do at least two things… be perceived as extremely thoughtful by the gift’s recipient, and also save money.
A fancy meal at a restaurant on Thanksgiving, the week of Christmas, or on New Year’s Eve is always fun. However, once it’s over… it’s over. And, when the meal which was eaten is paid for with a credit card, it’s sure to give a person an upset stomach when the credit card bill arrives a month later. Seeing a charge of several hundred dollars on a statement for food that was consumed, digested, and expelled a month ago can be upsetting. So, instead of eating out, consider having a low-key pot-luck dinner in the home. Guests may even enjoy this venue more than a crowded restaurant.
Using a credit card is definitely safer than carrying a huge amount of cash in a purse or a pocket while shopping during the holiday season. With a credit card, it if is lost or stolen, it can be reported immediately and the card can be deactivated. Also, it’s quicker and more time-efficient to swipe a credit card in a machine than take five minutes to write a check for a purchase. So, as long as spending can be kept under control and gift buying is kept to a minimum, using a credit card can be a smart choice in November and December of each year.
About the Author: Glen Singleton. To read about spoonbill catfish and jugging for catfish, visit the Types Of Catfish site.