The modern financial system is increasingly using electronic transactions for purchases. As cash is used less debit and credit card use is rapidly increasing. The banking industry is increasing fees on debit cards and accounts, making the use of credit cards more attractive.
Many chain stores have their own branded store cards. They are generally limited to only being used in a particular chain or its affiliates, which only makes them useful if you regularly shop at that chain. You should also be aware that all applications are noted in your credit history and if there are too many applications then your credit score can be negatively impacted if they are approved or not.
The credit card has become so widely available that people in many instances forget that they are not spending their money but effectively taking out a small high interest revolving line of credit. It is common for people to get there credit card bill and have no idea what the value will be before opening the envelope. If you are going to a credit card then keep an accurate record of your continuing balance and check it online regularly. Pay it out completely at the end of the month to avoid interest payments and to keep your credit score in good order.
Be wary of pre-approved cards
If you receive a pre-approved card offer, it is important that you understand the conditions and read the fine print. Many use an attractive rate for the first six or twelve months that is then increased after that period. Others have attractive interest free periods to start with and then start charging interest from day one when the special offer period expires.
Check on the fine print
There are is a lot of competition in the credit card market and many have special bonuses that such as extended warranties, longer interest free periods or exceptionally low interest rates. There are usually, some quite onerous conditions that you need to meet to keep these bonuses. They can include a minimum dollar value that must be spent in a time period. It is important to check the fine print so that you know what you are committing to and what the penalties are if you do not meet your commitment.
Have a problem talk to the bank first
If you have run into a financial problem that is temporary in nature then you need to contact your financial institution. They may be able to extend the due date and arrange a payment plan that avoids a late payment being registered. This is important as it can adversely impact your credit score.
A top way to improve your credit score is to pay before the due date. This is a simple easy way to boost your score and you can do it all online with a few mouse clicks. Remember that late payments not only earn extra fees but they will drag down your credit score.