How are you using your credit cards? Do they sit in your wallet, longing to see the sunlight? Or are you getting the most out of the benefits that come with them? A lot of people claim they have a credit card to “build credit” or “in case of an emergency,” but these are often fringe benefits to having them. What exactly are you missing out on?
Choosing the Right Cards
First, you should figure out what constitutes the “right card” for you. It depends on what you like, to be honest. Does it come with perks like cashback or other kinds of rewards? There are a lot of credit cards that have perks like the Target REDCard, where you get 5 percent off every purchase, or the Chevron Visa Card, which offers a slew of discounts on gasoline. You should research all of the options available to you and see if you can find a credit card offered by stores and locations you frequent.
Recently, I wrote an article about how much is really enough to have in our savings accounts. After thinking about it, I thought to myself, “How much should we have in our checking accounts?” After talking with some people about it, it’s become apparent to me that many people think it should be similar to the minimuim they keep for their savings account.
If you read my last article, you know that your minimum savings should be equal to all of your living expenses plus necessity expenses for each month that it usually takes you to find another job. This is a bit much to require yourself to have in your checking account as well. If you can do it, more power to you. For the rest of us, the idea revolves around purchasing power.
Building credit with a credit card sounds like common sense, right? Get approved for a credit card, use it, then pay off the balance on time and never allow it to over your limit. Sounds simple, but it really isn’t. Many lack the self-discipline that it takes to actually do something like that. Instead of trying to find out how one could learn this kind of discipline, they just use their instincts, which usually ends poorly. There’s a better way to do this. Even if you don’t have much self-discipline, here are a few tips that will help you in the long run.