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3 Things to Remember About Credit Cards

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A credit card can be an excellent way to build your credit and track your spending habits. But it’s also something you need to use responsibly because of the potential negative implications if not used properly. Thankfully, there are many benefits associated with using a credit card responsibly.


If used correctly, a credit card can help build your credit, save money on future purchases, and even get rewards like cash back or airline miles. Here are three things you need to remember about credit cards so you can use yours wisely.


Pay your bill on time


when is my credit card bill due? The most important thing to remember when using a credit card is to pay off your bill every month in full. Credit card issuers make money off your interest charges, so they want you to do this. Credit card companies will report your payment history to credit bureaus, which can affect your credit score.


Paying your bill on time and in full can help you build credit and increase your credit score over time. If you cannot pay your bill in full, or if you miss a payment, your credit score could take a big hit. Your credit card company may also charge you higher interest rates and higher fees. You may even be at risk of having your credit card account closed.


Credit cards can have an impact on your credit score


Your credit score is a numerical representation of your creditworthiness. It’s used by banks to determine if you get approved for credit cards, loans, mortgages, and other types of credit. The higher your score, the lower your interest rates generally are. Credit cards make up about 30 percent of your credit score. So it’s important to understand how and why credit cards affect your credit score.


And remember that the higher your score, the better the terms you will be offered. Credit cards and your credit score have a two-way relationship. They need your credit score to be high enough to approve you for a credit card. On the other hand, your credit score affects how credit cards treat you. According to SoFi, “Even if you want to live a largely credit-card-free lifestyle, having a solid credit history is helpful. If you ever want to take out a mortgage or finance a car, a good credit score might help you secure better terms and lower interest rates—while a poor one can keep you locked out of those financial products entirely.”


Always be on the lookout for changes in terms and conditions


Credit card companies can change their terms and conditions at any time. These can be changes to interest rates, fees, or rewards programs. Sometimes, there may be changes in the mailing or online terms and conditions. You can regularly check your account and keep tabs on important information like your credit limit and interest rate. You can also be on the lookout for changes by regularly checking your credit score and credit report.


Credit cards can be a great tool for building credit and managing spending. However, you need to pay your bill on time and in full each month to avoid interest charges and maintain a good credit score. You also need to be aware of any changes in terms and conditions to make sure you understand exactly how you can use your credit card.

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