Posted by Linda Schultz | Comments Off on How Many Credit Cards Should You Have?
A lot of people are afraid of credit cards. They’ve seen people who racked up a tremendous amount of debt and are concerned that the same thing could happen to them if they’re not careful.
However, unless a person has a serious credit card addiction, people should try not to avoid credit cards outright. The right cards can help you to build credit, and can make your credit report look a lot more attractive to lenders.
So how many credit cards should a person have? Most experts say that 2-3 credit cards are advisable. This is enough to help a person build more credit, but not so much that lenders will think they have too much credit.
Keep these things in mind if you’re trying to decide what your 2-3 credit cards could be.
- Look For A Card That Offers You A Special Incentive
If you’re using a credit card, you should be trying to get more out of it than a higher credit score. If you play your cards right, your credit card could save you money, and could even earn you special perks, such as frequent flyer miles.
When you’re looking at cards, try to find one that will offer you some kind of special perk. Whether you opt for a cash back credit card or a card with some other kind of benefit, you’ll be getting the most out of the plastic in your wallet.
- Don’t Spend Money You Don’t Have
The main reason people run into problems with their credit cards is that they use them irresponsibly. They treat them like free money instead of like something they’ll need to pay back later on.
Unless you’re in an emergency situation, you shouldn’t use your credit card to pay for something you don’t have the money for. You’ll just wind up building up lots of interest.
Try to use your credit card for lots of purchases, but always pay off your balance at the end of the month. This will help you to build a healthy credit score, and will keep you from falling into debt.
- Avoid Cards With High Fees
Some cards charge annual fees to their users. This is especially true of cards that are aimed at people with poor credit.
While you don’t have to rule out every card with an annual fee, you should stay away from cards with fees that are very high. Your credit cards should be helping you, not hurting you. If your card has too many fees, it may make it difficult for you to keep your finances in order.
- Consider Making One Of Your Cards A Store Card
If you’re interested in having three cards in your wallet, think about making one of them a store card. Store cards are very easy to get, even if your credit score is very low. They also offer a lot of incentives to shoppers.
See if any of your favorite stores offer some kind of card. If they do, take a look at what the card has to offer. See if this card is something you would like to apply for.
- Don’t Get All Of Your Cards At Once
If you don’t have any credit cards right now, you shouldn’t feel as though you have to get three credit cards immediately. While 2-3 credit cards are advisable in the long term, you should try to work your way up to this point.
Start off by applying for a card that is easy to secure. Use this card regularly and raise your credit score. After some time has passed, you should be able to secure a more prestigious credit card. After that, you can decide whether or not you’d like to add a third credit card to your wallet.
It can be hard for people to figure out how many credit cards they should have. Some people may have too many while others may not have enough. As long as you aim to have 2-3 credit cards, you should be in good shape. You don’t want to overdo it, but you do want to make sure you have something to show to lenders.Read More
Posted by Linda Schultz | Comments Off on Tips For Filling Out A Credit Card Application
It goes without saying that the goal of filling out a credit card application is to get approved for a new card. Unfortunately, getting that approval can be challenging for certain cards, depending on the credit requirements and income requirements of the card issuer. There are a few things that you can do to improve your chances of getting your application accepted.
First, before you begin applying for credit cards, you should work on improving your credit score as much as possible. The higher your credit score is, the more likely your application is to be approved. Not only that but a high credit score will allow you to apply for cards that have better interest rates and more appealing perks. If you have a low credit score, you will be limited to cards that either require you to pay extremely high-interest rates or that require you to deposit money on the card before you can use it. Although these types of cards can be good for rebuilding your credit, they are not ideal from a financial perspective.
Every consumer is entitled to a free copy of their credit report each year. Before you fill out your first credit card application, request a copy of your credit report and review it to make sure that all of the information in it is accurate. Additionally, if you already have other credit cards, pay them down as much as possible at least a month before you apply for a new card. This will give your credit report time to update so that it reflects the new balances on your cards. The less of your available credit you are using, the higher your credit score will be. Ideally, you should try to be using less than 30% of the entire amount of credit that you have available to you. If you are using more than this, it could negatively impact your credit score, thus affecting your ability to qualify for a new card.
Avoid the temptation to lie when filling out a credit card application. Don’t list your income any higher than it truly is. Likewise, don’t underestimate your housing payments. Credit card companies decide on your creditworthiness and your ability to make your payments based on these figures. If you lie about them, not only are you committing fraud, but you could be putting yourself in the position of having a difficult time paying back your credit card. If your credit limit is too high and you max out your cards, you will have a hard time affording your monthly payment which can cause you to be late with payments or miss them altogether. This, in turn, can negatively impact your credit score.
Ideally, you should apply for credit cards that are a good fit for your current finances and credit score. For instance, if a particular card has a reputation of only approving people with a credit score that is above a certain point, you shouldn’t even bother applying if your credit score is too low. Otherwise, chances are your application will be rejected. There are plenty of forums and websites online that provide information on the average credit score that most credit card companies require. This can help you find card offers that are a good match for your current credit situation, improving your chances of getting approved.
Over time, as you build your credit and increase your score, you can apply for additional cards that may have lower interest rates or better perks. However, by starting out with cards that you know you can get approved for, you can get your credit journey off on the right foot. Whichever card you are approved for, just make sure to always make your payments on time and to use your credit responsibly.Read More
Posted by Linda Schultz | Comments Off on Tips To Avoid Bad Credit With Credit Cards
If you are planning on applying for a loan, student loan, or for a home, you will want to make sure that your credit report is absolutely as good as can be and that your debt level is manageable. The good news is, keeping your credit score high and avoiding bad credit with credit cards doesn’t have to be too difficult. You simply need to follow some rules and tips and you should be able to avoid bad credit with credit cards. In this article, we will be going over some of the top tips to avoid bad credit.
Tips To Avoid Bad Credit:
- Pay Your Bills.
This is perhaps one of the most important things that you can possibly do in order to not have to deal with bad credit. You are going to need to pay your bills on time – every time. The more bills that you put off, not only are you going to accrue interest and hurt your bank account, but you are also going to significantly hurt your score as it is one of the primary factors that is looked at when determining your overall score. The best way to ensure that you pay your bills on time every single time you have a bill available is by turning on ‘auto pay’ which essentially takes the amount that is due out of your checking account for you.
- Don’t Hit Your Limits.
Another thing that you will want to avoid doing is getting too close to your credit card limits. This is an important thing that you will want to take seriously because the more you spend on your card and the closer that you get to your limit, the more risk the bank is essentially going to view at providing you with credit. They are going to look and see that your spending habits are very large and this only generates more risk for them. Therefore, this can significantly reduce your score. For the best possible results, you are going to want to keep your available credit at around 70%. Meaning, do not utilize more than 30% of it. If you need to, you can simply spread around payments to different credit cards.
- Pay Your Bills In Their Entirety.
Another thing that you are going to want to do is make sure that you are paying your bills in their entirety. You want to try to pay your bills in full because if you do not, you will accrue interest on them and you are going to end up losing money as a result. Minimum payments can trap you into a never ending debt cycle. Therefore, track your spending and do not purchase anything that you are not going to be able to pay off in full at the end of the billing cycle.
- Spread Your Applications Out.
Another thing that you are going to want to do in order to keep your credit score as high as possible is to make sure that you are not applying for too much credit in too little time. If you are planning on applying for credit cards or some kind of loan, you will want to make sure to do them at the same time or completely spread out. Otherwise, lenders will wonder whether or not you are digging yourself too far into debt that you have to keep applying for more credit. They will ultimately view you as being riskier than they would like and it can impact your credit score as a whole.
As you can see, there are many different things that you are going to want to do when it comes to trying to avoid bad credit. By implementing the tips above, you should be able to position yourself to achieve a good overall credit score. Be sure that you are not utilizing too much of your available credit on any particular card. Make sure that you are not applying for cards or loans too quickly. And make sure that you are paying off each and every one of your bills in their entirety every single time. You do not want to miss payments or else you will need to pay off late payments and you are going to have to deal with interest as well.Read More
Posted by Linda Schultz | Comments Off on Is Having Credit Cards Good Or Bad For Most People?
It is always a good idea to have a credit card that you can use from time to time in order to have a backup in case you are the one money. It is also a great way to build your credit, and also earn points on different things that you would like to purchase such as airline tickets or hotel rooms. However, there is also the ongoing debate as to how many credit cards are enough, or if having credit cards at all is actually a good idea. Here are the pros and cons associated with deciding whether or not having credit cards is good or bad for most people.
Positive Reasons To Having A Credit Card
There are several positive reasons why a person should have a credit card. First and foremost, it is the best way that you can build credit when you are younger. Also, everyone can apply for and receive a small credit card, usually giving them a few hundred dollars in credit, which they can use to begin to build their credit rating. By charging a small amount and paying it off every month, you can develop your credit rating very quickly. From there, you will be able to qualify for a mortgage for a home if you want to buy one, and you could also get lines of credit for a business that you want to start. Unfortunately, this can also go the other direction. Sometimes people will spend all of their available credit and forget to pay their minimum payment on their credit card. This can be to some of the negative reasons for having a credit card, usually the result of making poor choices.
Negative Reasons To Having A Credit Card
The main reason that having a credit card is bad is that it can become a form of temptation in terms of spending beyond your means. Many people that start with a small amount of credit are often given the opportunity to get additional credit cards, and this can cause a significant problem. They will charge all of their credit cards up as high as they can go, and then they are forced to make monthly minimum payments. If that is all they do, they will never pay off the total amount, creating a negative balance with their paycheck every single month. Instead, when you are offered credit cards, you should rotate your use of them. You might want to keep a small balance on one to build credit in that manner, whereas the others you will simply pay off at the end of the month, both strategies helping you to build your credit rating.
Anyone that has a credit card can make a choice. The choice that they make is going to either make owning a credit card a good or bad decision. Credit cards are similar to owning a weapon. It can be used as a line of defense, or it can be used in an inappropriate way. In conclusion, it is definitely better to have a credit card than not to have one, especially if you ever want to build up your credit rating so that you can become a functioning member of society with a mortgage, or the ability to get a car or boat loan. It is a great way to establish yourself as a person that is trustworthy enough for lenders to provide you with these loans.Read More
Posted by Linda Schultz | Comments Off on Credit Card Companies Make Money By Charging All Kinds Of Fees & Interest
Credit card companies have no problem making money, do they? People need credit, and they have the money to provide as long as it’s paid back with interest. People think they are getting a sweet deal with a 0 percent introductory APR until all the sudden they have a considerable balance still due on the card and the interest rate moves to 10, 20 and even 30 percent. Not to mention, if you ever miss a payment or go over your credit limit, you’re going to get charged a fee.
There are all kinds of fees associated with credit cards. I’m not saying they don’t come in handy. I have four of them. You’re technically only supposed to have two, but I have extras because I was building my credit and was offered better cards along the way. I will get rid of one or two of them as I go along or just keep them paid down and open.
Have you ever been charged a late fee on your credit card? Many credit card companies are good about refunding late fees and over the credit limit fees these days, but you really do have to watch because they can actually make those fees stand. Now, that’s not all that credit card companies have up their sleeves. Think about what else you’ve run into, especially if you have had bad credit.
There are credit cards that come with an annual fee, and there are also monthly participation fees for some of the cards out there. As a matter of fact, one of the credit cards I have that was for people with bad credit just told me that my annual fee was coming up and that my monthly participation fee would now be due. You don’t want to mess with those types of cards unless you have to do so.
They will charge you extra money, and some people realize that they just can’t swing the payments and end up in a cycle of bad credit. I’m doing just fine, but those credit card companies are still making money off of me. They don’t just make money off of people in general, they get filthy rich. The credit industry just keeps growing and growing, and it would probably make you sick if you look at how much you’ve paid on a credit card vs how much you’ve spent.Read More
Posted by Linda Schultz | Comments Off on Prepaid Credit Cards Could Be Your Big Ticket
You’re sitting there with a ‘not so good’ credit score, and you’re wondering how to improve your credit. It’s not like you haven’t heard of prepaid credit cards, but maybe you’re just not sure if they would be worth the effort. Let me tell you what’s going to happen if you sign up for a prepaid or secured credit card.
The first thing I want to mention is after a few months of handling a secured credit card properly, you’re going to get an offer from someone for an unsecured credit card. It might not even take that long, and you might get more than one. Of course, you have to treat that secured credit card the right way.
Even if you can get approved for an unsecured credit card with bad credit, there are going to be high fees attached to them that lower your available credit right away. There are secured credit cards that won’t do that to you. Why not get a secured credit card with a top-notch company and aim for getting approved for an unsecured credit card with them.
Now, what else can you expect when you sign up for a prepaid or secured credit card? If you keep your balance low and make your payments on time, you’re going to significantly improve your credit. There are going to be three, yes three, factors that help to work in your favor. First, you will have established new credit and now have a credit card account on your credit report. Second, you’re going to be making your payments on time. Third, you’re going to be keeping your balance under 30 percent of your credit limit.
Do you see how much these secured credit cards can work in your favor? It’s suggested to have two major credit card accounts open, but in this case, you’re only going to open one. You’re just going to get your foot in the door, and as you manage your secured account wisely, you can be picky about the offers that start coming to you.
You might not want to go for the first offer that comes your way. It might be from a credit card company that is going to offer you a subprime rate, and you’re not desperate, right? You will have made the right choice to take a secured card and wait for a good credit card company to court you.
Of course, you’re going to have to pony up that deposit. Most of the secured credit cards will open up an account for you with 200 or 300 dollars as a deposit. Remember, that will be your credit limit. If you’re able, it might be better for you to start off with at least 500 dollars.
If you need some time to get that deposit together, you can send payments in increments for certain credit card offers until you have the deposit paid in full. Check to see what’s out there and get that prepaid credit card working for you.Read More
Posted by Linda Schultz | Comments Off on Credit Card Tips For People Trying To Build Their Credit
The absolute best piece of advice I want to give you first when it comes to having a credit card is to keep a low balance. I’m not going to tell you to pay the balance off each month because that is hard to manage anyway, as it has everything to do with timing, form of payment and really staying on top of your game financially. However, you really need to keep yourself from getting anywhere close to maxing out your credit card.
If you keep your balance at about 30 percent of your credit limit, you’re going to make the credit card company happy, and you’re going to improve your credit score. When it comes time to get a credit line increase, you’re going to have a much better chance of getting the best increase. Of course, the credit line increase is also going to be dependent upon other factors.
If you fail to make a payment on time, even one, it’s going to look really bad. You want to be sure that every payment is made before the due date. Additionally, pay more than just what is required. It is tempting to make the minimum payment, but remember you want to keep the balance at 30 percent of the credit limit anyway. Anything you can pay over the minimum payment is only going to help you in multiple ways.
When that credit limit increase does arrive, and it can be quite soon, it’s going to help you keep your balance at 30 percent of your credit limit. Say your limit is 300 dollars to start with, and you get an increase to 1,000 dollars for your credit limit. Let’s say your balance on the card is 150 dollars. Before, your balance was at 50 percent of the credit limit, but with the increase, you’re all the sudden only at 15 percent of your credit limit.
You’re certainly aware that there are rewards cards out there. Find a good cashback rewards card that you can count on for extra perks. How you use that cash back is up to you of course, but I can tell you what I do with mine. I save it up, and then I apply it to my bill. It keeps my balances lower, and it is of course free money. According to these guidelines, are you handling your credit card correctly?Read More