The credit card offers you convenience and security alongside other great benefits and awards, when used with a touch of sense. It can also help you build a good credit score which in the long run helps you get financial benefits.
Since it is an easy way of making payments, even when you do not have the money at hand, you must recognize that your credit card is not a portal to use ‘free’ money; an opportunity to accrue debts.
If you fail to understand this, I am afraid, your financial goals will not be reached. What I have shared with you in this post will help you grasp the ways to use your credit card responsibly.
1. Secure Your Credit Card
One of the smart ways to use your credit card is to keep the card details safe and secure. This would involve keeping it out of the sight of a third-party and making sure only you know the card PIN.
So allowing it in your wallet can be a nice suggestion as to the way you can keep it safe. And of course, you will only need to bring it out when you want to make a payment.
In the same vein, you should not reveal your card PIN to another person. This will help you take responsibility for every transaction that occurs from your card.
If by chance you lose your card or it was stolen, quickly contact your card issuer for immediate deactivation.
2. Scrutinize Your Monthly Statement
As a responsible person you are, you should concern yourself with every transaction details on your credit card monthly statement.
Scrutinize each and be sure it is what you bought. Also, make sure that interests and fees charged are in line with what they should be.
Before the payment date is due, do well to raise a query for any of these details you do not recognize. If you pay no attention to this, you would probably be overpaying or paying for what you did not get.
3. Do Not Go Above Your Credit Limit
It is not a good idea to go over your credit limit. Aside from the fact that you will be penalized or charged according to the amount you go over with, the health of your credit score is also compromised.
It is not a good sign on your credit score, as it only defies your ability to manage your credit. In some cases, your card issuer can even reduce your credit limit or in the extreme, close your credit account.
What you should rather do is apply for credit limit increase, if you feel you need more to pay your bills. And while doing that, you should be sure you can pay back when the time is due.
4. Avoid Credit Card Debts
It will be responsible for you when using your credit card to avoid debt. Your credit card allows you to spend more than you have. So it is easier to run into debt when you do not have a strict line drawn.
You should use your card to pay for low price items, and not large amounts that would run you into debt. Strive not to use the majority of your available credit, as this will help you avoid the penalties arising from going over your credit limit.
To stay out of debt, you should also plan to pay off in full each month and not the minimum payment.
5. Pay On Time
A key point to consider as one of the ways of using a credit card responsibly is making payments on time.
You should care about your credit score because a poor one will deprive you of such things as loans and even a credit account. On-time payment is a good sign of your payment history.
You set a reminder that will help you know when your due date for payment is near. Some card issuers can allow you to configure an automatic payment from your bank account, making it easier for you to pay back and on time.
The Bottom Line
You have a huge responsibility, and that is making sure you reach your financial goals. Paying little or no attention to the way you use your credit card can only give you a helping hand in failing in your finances.
By ensuring your card is secure and safe, scrutinizing your credit card statement for irregularities, staying within your credit limit, avoiding debts, and by making payments on time, you will arrive on the ways to use your credit card responsibly.