Sometimes life throws you a curve ball, and you are unable to pay cash for an unexpected expense. When this happens, you pull out your credit card to cover it. Unfortunately, unless you can pay the entire bill when your statement comes in you’re going to get added fees. There is another way to avoid this. Many people are already using the credit card system to their advantage.
If you have a good credit score, you can apply for balance transfer credit cards. They offer an incentive of anywhere from 6 to 12 months of zero interest. It will cost you 3 to 5 percent of the amount transferred depending on the supplier. But, considering that most credit cards charge 10, 12 or 15 percent interest each month, it’s well worth it. It gives you a way to pay off a large balance without accumulating extra fees. This will also pay off your other card and improve your credit score.
Of course, this system will only work to your advantage if you refrain from non-essential purchases. For instance, if you pay a card off and transfer the balance to another, then run that card up too you’re not going to save any money. If you use this card to pay off another and leave the other card alone you’ll gain the benefit.
Credit cards offer many benefits if you know how to use them. Many offer rewards such as air miles, cash back, and other similar perks. For some, getting their first credit card gives them a way to buy things they could not otherwise afford. This will get you into debt quickly. For others, who understand the importance of budgeting, a credit card is a convenience. They use it for daily purchases as well as vacations. The difference is that they have the money to covers the bill. If you use your card responsibly, you can improve your credit score and have access to credit in the event of an unexpected expense.
If you’ve already maxed out several cards and are looking for a way to dig out without it costing a fortune, a balance transfer credit card can help. If you still have your credit score intact it can offer the solution to your problem. This will only work if you are willing to take on a new approach to credit cards. It’s easy to give into impulses and buy a frivolous purchase. If and only if you are ready to use credit the right way should you apply for another card. Remember having too many cards also lowers your credit score.
You can use a credit card almost anywhere. This is good for those who understand the responsibility of using one and bad for those who can’t resist. The next time you pull out your credit card ask yourself if this is a purchase you need. If it’s something that can wait, chances are you should be saving for it. You should never use your card for wants. Learn how to save for the big-ticket items and purchase them interest-free.
Categories: Credit Cards