Credit card best practices

Credit card tips

Instructions: Click each phrase to read credit card best practices.

Look for low-fee, low-interest

Get a credit card with a low annual fee and low interest rate. Be sure to read your cardholder agreement. It spells out all the fees and finance charges. Call your card company’s customer service number if you have questions.

Pay off as much as you can

Always make at least the minimum payment each month, but pay as much as you can each month. Pay off the entire balance whenever you can. This will reduce the finance charges you pay.

Be sure you can afford it

Don’t use your credit cards to buy things you really can’t afford. Follow your spending plan.

Keep within your limit

Track your credit card charges throughout the month. If you stay within your credit limit, you’ll avoid overlimit fees and damaging your credit rating. Try to keep your credit card balance below 70% of your limit at all times. That will help you build credit by showing lenders that you can control how much credit you use, and it leaves credit available in case of an emergency.

Pay on time

Pay your credit card bills on time. This is one of the best ways to build good credit because it shows lenders that you’re reliable. It also helps you avoid late fees. Make sure you check your statement each month for the payment due date because it’s not necessarily the same date each month.

Avoid cash advances

A man using a bank ATM.
Some credit card companies may offer you a cash advance. Avoid this option except in emergencies. You’ll be charged a fee and the interest rate is usually much higher, and interest charges typically start immediately.

Get debt help early

If you’re getting into trouble with debt, get help early. Contact your lender. Try to work out a repayment plan that works for both of you. You may also want to consider talking with a reputable, non-profit credit counselor, an experienced professional, who can help you get out of debt.

Click the Next button to learn how to read your credit card statement.