Are You Ready for Credit?

Can your monthly income support credit card payments? Do you have a responsible attitude towards money and spending?  Here are some tips designed to help you get the most out of a credit card and to build your credit rating for a great financial future:

• Don’t charge more than you can comfortably pay off each month.
• Never go over your credit limit. 
• Always make at least the minimum payment each month, but aim to pay off the entire balance whenever possible.
• Avoid temptation on nights out with friends; leave your credit card at home and take cash instead. 
• Ask your Credit Union for simple advice on how credit can help you, and about budgeting.

Credit Cards – Which Card is Right for You?

You never want your first steps into the world of credit to be rough ones. A bad credit rating now can affect you for years and really make it difficult for you to achieve financial goals.

Here are some really important questions to ask when choosing a credit card. Your ultimate goal is to find one that meets your needs but also offers affordable options that can benefit you and your credit rating.

• Is there an annual fee?  (a once-yearly fee, even if you don’t use the card)
• Is there a special introductory interest rate? 
• What is the rate after the introductory period ends?
• Are there special provisions, such as a minimum income?
• If I don’t meet the minimum income provisions, what is the rate?
• What is the credit limit of the card?
• What happens if I exceed this limit?
• What percentage of the balance is due monthly as a minimum payment?
• Can my income support monthly payments, plus all of my living expenses?

Once you choose and receive a card that offers a reasonable interest rate and credit limit, make sure you use the card wisely.  Credit is not designed for pizza night; it is usually for large, planned purchases or for emergencies.  You should always aim to pay the entire balance off every month to avoid high interest charges.  But if you do use the card to its limit and have to carry a balance, be sure that you can afford the minimum payments every month.  Your credit union can help with budgeting and simple advice, so talk to them today.