Top 5 tips to use your credit card effectively

Advice Lifestyle

When you choose to have a credit card you should always make sure that the card works for you. A credit card can be an extremely useful tool if it is used correctly. Once you have decided which type of credit card you want, whether it be an interest free credit cards or another type, you must then consider how to use it in the most effective way. Here are 5 fantastic tips to help you on your way:

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¬†1. Don’t miss your payments

You may not be able to clear your whole balance each month, that is no problem, but it is of great importance that you at least pay the minimum amount on time. If you do not pay on time then you are likely to damage your credit score which will make it more difficult for you to borrow money in the future. Sometimes when you miss a payment you can also lose promotions that have been added to your agreement.

2. Pay by direct debit

If you set up a direct debit it means that it is almost impossible for you not to pay on time, of course you need to make sure there is the balance to pay in your account. Everyone makes mistakes and forgets important dates and things they have to do, so set up a direct debit to be on the safe side.

3. Use your card to spread the cost of large purchases

There are a lot of credit cards out there that will give you a set time period with 0% on all purchases. If you have such a card and you are looking to make a large purchase then you should use it for things like this.

4. Get a card that rewards you

If you are a person that will clear their card balance in full every month then you should certainly be looking at a card that offers cash back. This will reduce your monthly bills. You can also find cards that will reward you with points that can be exchanged for money off in chosen shops or air miles.

5. Try to avoid overseas’ fees

There are certain credit cards that will not charge you an overseas’ transaction fee, your debit card will charge you a fee. If you travel a lot then it is important that you find a card that doesn’t charge you when abroad or a card that charges you a minimal amount that suits you.

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