Credit Cards

Credit Cards

A credit card is a card that allows you to borrow money against a line of credit, otherwise known as the card’s credit limit. You can use this to make purchases, balance transfers, and/or cash advances and you will need to pay back the loan amount in the future. Interest charges will be applied to the remaining loan balance. Credit cards can used to improve your credit score. Regularly using credit cards responsibly allows you to build credt because it shows lenders you can manage credit. 

PROS
  • Help you build your credit score
  • Safer and more convenient than carrying cash or a debit card
  • Borrow money from a lender to make purchases
  • Earn points/miles on money you’re already going to spend
  • Helps build relationships with lenders
CONS
  • Easy way to go into debt if you’re not responsible
  • Cause you to overspend
  • Interest can make a small debt into a large one very quick

Be Responsible with Credit Cards

DO'S
  • Spend responsibly and within your means
  • Treat your credit card like a debit card
  • Pay off your statement in full
  • Keep your accounts open and in good standing
  • Use reward programs to your advantage
  • Monitor your credit score regularly
DON'TS
  • Max out your credit
  • Use credit as a substitute for income
  • Miss a payment
  • Carry a balance
  • Apply for credit you don’t need
  • Share your credit card information with everyone