There are plenty of positives about carrying plastic instead of cash. Convenience, frequent flier miles and boosting your credit rating are a few. However, as so many Americans have learned, credit cards are only advantageous if used correctly. It’s no secret that credit card debt has emerged as a significant financial concern for millions of card holders. Getting out of credit card debt is an arduous task. Avoiding it in the first place is much easier, if you have the self-discipline to follow a few simple rules.
1. Choose wisely: Frequent flier miles or cash back on purchases may come at a high price. Find out the Annual Percentage Rate (APR), the interest rate that will be added monthly to any outstanding balance. Also see if the rates are fixed or variable. Next, find out what the grace period is and review all fees, especially transaction fees. Then look for any other charges such as special delinquency rates, which can be very high. Read the fine print carefully and, remember, credit card companies make a lot of money under the assumption that you won’t pay your bills in full and on time every month. Shop around and compare cards. CreditCards.com is one of several places to make comparisons.
