Credit Cards -- What You Should Know

There are a lot of questions about using credit cards. Here's some important points for you:

A quick look around on the Internet this morning shows that more than 9 million people in the UK do not pay off their credit card balances each month. (The principles of what follows are the same in the USA, or wherever you are right now.)

The average balance left outstanding is over £1000. The interest charged on such a balance varies according to the card, but we have seen rates of up to 29%!

When you bear in mind that banks are offering somewhere in the region of 3% interest on account balances, it's easy to see how such a fantastic amount of money is turned over within the banking and finance industry!

Consider a card with an average outstanding balance of £1000: with an interest rate of 19%, this could take over 20 years to pay off at minimum payment levels! On a balance of £1000 at 19% for 20 years, you'd pay back a total of £3889.

Credit cards are a tool designed to make a profit for those who issued them. They are not provided for your convenience! The only way it makes sense to use a credit card is to only use it up to a point at which you can pay the full balance each month.

In other words you are using it to access money you already possess, and not using it as a form of loan. To use a credit card for a loan is going to be some of the most expensive credit you will ever encounter.

I know that life isn't always easy, and some people will say they need to use a credit card to get by. This is the worst position you could be in, and it is really important that you do something about your financial circumstances if you are in this position. Continuing along that path will steadily and inexorably lead to financial disaster.

Nobody said it's easy! But I would be doing no service at all if I avoided the facts, even if it's not what everybody wants to hear.

Another unwise use for a credit card is to get a cash advance from an ATM machine. whereas with purchases on the credit card there is an interest-free period up until the next payment is due, there is no such period of grace for cash withdrawals. Use a debit card instead.

And be aware of the deal with store cards. These can typically carry some of the highest interest rates around. Any savings are often have wiped out by the fact that you are encouraged to buy more then you otherwise might have, and even if they are genuinely savings, they are typically dwarfed by the total interest when the balance is not paid in full.

Use your credit card wisely, use it to your advantage, and get on the right side of the credit card game.

David Andiers is the owner of RF Credit which is a premier resource for credit information. For more information, go to: http://www.rfcredit.com

---

Borrowing on a Credit Card

One of the easiest ways to borrow money of a... Read More

What You Didnt Know About Your Credit Card Numbers

Have you ever really looked at your credit card and... Read More

Four Tips How Homeowners Can Rebuild Their Life After a Foreclosure

Let's face it, if you are facing the possibilities of... Read More

10 Ways To Protect Your Financial Identity Being Used For Someone Else?s Shopping Spree

Someone impersonating you could be spending your hard-earned money.Impossible! Not... Read More

Making Sense of Credit Card Fees

In addition to the APR (annual percentage rate) and the... Read More

Credit Report ? How Your Credit Score is Determined

Most consumers are aware that they have something known as... Read More

7 Compelling Reasons Why A Prepaid Debit Card May Be Just The Financial Tool You Need

Prepaid debit cards are great financial tools and may be... Read More

Fair Isaac Corporation Credit or FICO Score

As I am not from the US, I had no... Read More

How to Save Money on Your Credit Cards

Credit card companies make their money on the 85% of... Read More

How To Eliminate Credit Card Debt

There is almost nothing more troublesome than having too much... Read More

Identity Theft ? Who Would Want Mine?

With all my bills who would possibly want my credit?... Read More

Minimize your Risk for Identity Theft

Identity theft is the fastest growing crime in America. According... Read More

Secured Credit Cards- Consumer Tips

Whether you have no credit or damaged credit, secured credit... Read More

It Is In Your Best Interest To Do The Math On Your Credit Card Interest

If you begin foaming at the mouth once a month... Read More

Do You Know The Top Five Credit Card Mistakes?

When you're dealing with credit cards, you're playing with fire.... Read More

Credit Damage: Getting Compensated for Your Loss

Until recently lawyers for victims of credit damage had little... Read More

Credit Help for Real Estate Financing: Five Categories of Your Credit Score

1. Payment History -- 35%The number of accounts paid as... Read More

To Repair Credit Is No longer Satisfactory - Learn How To Earn A Millionaires Credit In 30 Days...

To repair your bad credit does not necessarily mean that... Read More

Fight Credit Card Fraud with Common Sense

By now, you have undoubtedly heard of credit card fraud,... Read More

Trade Credit: How to Determine if You Should Offer Net-30 Terms to Your Customers

What is trade credit?One of the major differences between consumer... Read More

What You Need To Know About Credit Cards

What is a credit card? A credit card is... Read More

SuperCharged Secret 3, Credit Card Utopia

TURBO-CHARGED KILLER RATE SAVING INFORMATION!Let's just take a brief moment... Read More

Negotiating Rates with Your Credit Card Company

Ok, let's face it, everybody hates high credit card rates,... Read More

Opting For A Credit Card? Check Out Certain Terms

You've just received a "pre-approved" credit card offer in your... Read More

Useful Tips on Borrowing Money

Here are some useful tips on borrowing money. Borrowing money... Read More

How To Get a Low Interest Credit Card

Consumers often have the first credit card that they ever... Read More

What Are the Most Common Ways to Commit Identity Theft or Fraud?

It's the number one source of consumer complaints at the... Read More

How You Can Help Prevent Identity Theft

How can I prevent Identity theft from happening to me?... Read More

Annual Credit Report and Free Annual Credit Report

Getting an annual credit report review has been the advice... Read More

Credit Report And Correction Techniques

The three major credit bureaus, Experian, Equifax and Trans Union... Read More

The Hazards Of Your First Credit Card

You probably don't need me to tell you credit cards... Read More

Fair Credit Reporting Act: What You Should Know About It?

The Federal Fair Credit Reporting Act (FCRA) is designated to... Read More

Like It Or Not, You Have A Score To Settle! Part 1

Just when most people finish with school and can stop... Read More