Credit Cards

You Only Need One

If you can produce a fistful of credit cards from your purse or wallet you are doing it all wrong. You need only one. Learn to find the best one. Learn how to use it properly, then cancel and throw the others away. Too many cards makes it far too easy to spend more than you make and is one of the credit danger signs... and as you know that almost always means more debt. Annually the average person or family spends 10% more than they bring home. Is it any wonder that so many people are being buried in credit card debt?

What You Need To Know

Here is something you need to know. The only way  you find this out is to read the fine print of all those credit card contracts. As you are being buried in your credit card debt you may still be able to make all of your minimum payments. But don't miss one or be late. Here's what happens...

You will have the universal default cause come into play on your accounts. Universal default means that if your are in default with one creditor you are in default with all creditors. Then the default rates kick
in on your cards. Your rate could double or triple overnight. Be very careful about those payments.

Who Wants To Be Average? 

Now that you see how the average debtor is treated, you need to decide you are not going to be average. You are going to be living debt free. To do that you will need to work hard at credit card reduction. Work hard on both your balances and the number of cards you have. Too many credit cards right now? Pay them off.

You Need To Change Your Attitude

This will require a change in attitude. The first thing you need to know: You only need ONE credit card. Get rid of the rest. Then you need to know that card does not go in your purse or wallet. You lock it away somewhere. A place where you can get at it but not easily. This will keep you from using it for casual impulse purchases.

So, Which Card For You?

Now, as for that one card. Which one? What type?
That’s easy...you want a card with no annual fee. Why should you pay them to carry around their card? You shouldn’t, so don’t. A card with no annual fee allows you to pay only for value which you receive. Do not put any unearned money into anyone’s pocket but your own.

The card should also have a grace period for purchases. The grace period allows you enough time to pay for a purchase without having to pay interest. Which you will do each and every time. You will use your card for very specific transactions, not for every unplanned impulse purchase.

The card should have as low of an interest rate as you can find. Sometimes this is difficult to find, coupled with a no fee card. Our friends(?) at the credit card companies try to make money anyway they can. But it is more important that you find a no fee card than a low interest rate. You ask why?....

Because you are not going to carry a balance. Remember?

Since you are doing that the interest rate really doesn’t matter. So go for the low or no fee card. Now what to do with that card once you find it?

Now, Lock It Away

You lock it away. Your credit card can be used for car rentals and other transactions where the you need to show you are a real person. Other than that, the only time you should use your card is for a transaction to keep it active.

Let’s face it, the credit card company does not extend credit hoping you will pay it off each month. They want to make money from you when you carry a balance and they can charge interest. It’s just you are not going to do it.

It's No Secret, They Want Your Money

Oh, they will entice you with checks to use that draw on your credit line (Don’t even think about using them. The interest clock starts ticking the minute you use it. No grace period.) They stuff their statement envelopes with offers for this and that. Understand they want your hard earned money.

So eager for your money, they may sometimes require you to use your credit card every so often just to keep it active. They hope you won't pay it off. If this is the case, go ahead and do it, thenpay it off. They can require you to use it every once in a while to keep it active, but they can’t require you to pay interest.