Thursday, September 19, 2013

4 Tips to Credit Card Usage

While some people prefer buying on cash, there are advantages also to buying things on credit. Owning a credit card is a privilege and a responsibility and happy are those who know the art and science of managing it well. This article offers some tips to safeguard your credit standing and how to maintain a good business relations with your bank or credit card provider.

Just to show you that you can use a credit card to your advantage, let me tell you about my friend who owns a travel agency. Because of his good standing, he was able to secure a credit limit equal to flying a family of 5 to 10 members to overseas countries. He managed it well, paid well, earned the credibility and trust of his credit card provider, enabling him to have a high credit limit which he now uses to finance his business activities and operations.

Enroll in online banking

This is a good thing to do so as to readily see your transactions and credit card balance at any time you like. Aside from this, you can record expenditures in excel or word document or a notebook for there are times that a bank's website has to do maintenance or is down for some time. There was a time that I could not login to my online account for days due to the site's problem and I paid an over credit limit fee for not being able to know the updates of my expenditures. I tried asking for a reversal but it was not approved.

Always pay on time

Keep in mind your due date and pay on time. If possible pay in full to refrain from being charged by the bank. In spending, stay within your bounds or paying power. If you are able to pay 300 USD per month, then try to limit your spending within or less that amount. Wait till the cut off period before buying things on credit again.

Use of other payment channels

If you intend to pay on other channels or banking institutions other than your bank, pay 2-3 days ahead of the due date to have allowance for delayed posting. While your primary bank will post the payment on real-time, this is not the case with second or third party channels.

Decide on your card type

With the many services and consumer goods we have, some banks have come up with different credit cards also. There is the visa, master card, platinum, gold etc. and there are cards specialized for health care, travel or groceries only. Decide which card type is best for you depending on your needs. Credit cards have different membership fees too but the first year usually is free of charge.

To avoid from paying charges, read on the rules or terms of agreement. The more you know, the better you will be able to handle your finances.

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