Archive for the ‘Credit Card Tips’ Category

Schedule Automatic Credit Card Payments

Saturday, April 5th, 2008

How do you avoid making late fees on your credit card accounts?  Make credit card payments on time.

How do you make sure you’re never late?  Schedule automatic credit card payments.

Most credit card companies allow card holders to schedule automatic payments that are deducted from a checking account.  While you might be concerned about giving your credit card issuer access to your checking account, if your credit card issuer allows scheduling automatic payments with a preset amount, this limits the monthly payment to the amount you authorize.

Scheduling automatic payments prevents you from paying late and incurring a late payment fee.  If your credit card issuer allows it, automatic payments can make your financial life a little bit easier.

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Credit Card Convenience Checks

Tuesday, April 1st, 2008

You have probably received credit card “convenience” checks without requesting them.  They may have arrived with your monthly statement.  Or maybe they arrived all by themselves before school starts, before Christmas or anytime your credit card issuer wants to generate additional revenue.

And they probably came with an enticing, inviting letter containing a compliment similar to, “Because of your good credit, you deserve these convenience checks.”

Credit card convenience checks are mostly convenient for your credit card company.  For card holders, the checks hold more risk than reward.  Here are some tips about protecting yourself from the potential negative outcomes of credit card convenience checks:

  • Ask your credit card issuer to quit sending them.
  • Do not throw them in your trash for someone to find.  Shred them.
  • Before you use them, say to yourself, “This is debt.”
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Paying Your Credit Card Bill Online

Thursday, March 27th, 2008

Paying your credit card bill online is actually a good thing for most credit card users.

First, remember a late payment dings your credit score.  Mail travels at varying speeds and even gets lost.  (Though I don’t believe this happens as often as credit card companies hear this as an excuse.)

Online credit card payments generate a verification code.  Once your payment is made or scheduled, you will receive this code.  Keep it.  It’s proof your payment was made and verifies the time.  As one credit card company advertises, “Paid online is paid on time.”

Second, while most credit card company’s offer to suspend your paper statements once you begin paying online, I recommend you continue to receive paper statements.  Believe me, you’re paying for them, and if you ever need paper, electrons may not be a good substitute.

Third, take care of computer security.  Be certain the computer you use is secure and without viruses or malware.  Don’t use the same user name or password for different accounts.  Avoid using a publicly-accessed computer.  Take all the precautions necessary to ensure your electronic transaction is protected from hackers.

Fourth, verify you have enough funds available in your checking account to cover your payment when you click, “Pay Now”.

Other benefits of paying your credit card online are that you can do it without going to the post office or mail box, you can usually schedule payments in advance, you have access to a lot of information about your account when you log in and in most cases can easily review a history of your payments and transactions.  You can even schedule email reminders about upcoming payments or cautions about credit amounts, ala “your balance is now over $800.00″.

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It’s Really a Debt Card

Monday, March 24th, 2008

The term “Credit Card” begs a question: why is it not called a “Debt Card”.  It was a brilliant marketing move to avoid calling them what they really are: Debt Cards.

Here’s an idea that you might find helpful.  The next time you take out a credit card, look at it and think to yourself (or say it aloud if you think it will help), “This card in my hand is a Debt Card.”

Sure the bank offers you credit, but once used, it is absolutely debt.  Teach your children to call them debt cards, too.  They may thank you for it in the future.  Think, “This card in my hand is a Debt Card.“

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Best Credit Card Practices

Monday, March 24th, 2008

Credit cards are like fire.

Use them wisely and you have a tool that enhances your ability to accomplish things.  Use them unwisely, and like those who play with fire, you’ll get burned.

Using credit cards wisely requires that faithfully do the following.

1.  Always pay on time.
2.  Pay the balance in full each month.
3.  Always pay at least the minimum balance if you can’t pay the balance in full.

If you pay late, you’ll get burned with late fees.  Pay too late and your interest rate will increase.

If you fail to pay the balance in full each month, you’ll pay interest.  If you use your card for unnecessary things like coffee or eating out, you’ll pay more than the drink or meal was worth.

If you pay less than the minimum balance, at a minimum you’ll get burned with an higher interest rate and a rising balance.

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