Got Your First Credit Card? Use These Tips to Make the Most of It
The day a young canadian person gets their first credit card is a major milestone in their financial life. Whether you are working hard at your first job, working your way through college or still in high school, having a credit card is a lot to handle.
That credit card is more than just a way to buy things with your signature. No matter what you buy, the bill inevitably comes. Knowing how to handle the credit line you get will play a vital role in your financial future.
If you handle your new credit card properly, you can build up your credit score and make your future finances easier. If you mess up, you could destroy your credit score and make everything that comes after, from getting a car loan to qualifying for a mortgage, much harder. Here are some smart tips to help you make the most of your new credit card.
• Read the terms and conditions carefully. Note the interest rate, the grace period and the monthly billing period.
• Find the closing date for your credit card and set a calendar reminder for three or four days later. Contact the credit card issuer if your paper or electronic system has not arrived.
• Do not rely on getting a statement in the mail or your email inbox. Always follow up to make sure you do not miss the payment deadline.
• Track your spending online and make sure you are still within your budget. If paying off the balance will be difficult, stop spending and reevaluate your budget and your buying choices.
• Set a monthly budget for your credit card spending and put that amount in the bank. Use those funds to pay off the balance in full.
• Make sure you are not paying a premium to use your credit card. Some venues, like auctions, may charge a fee for credit card use.
• Stick to one credit card for now. Using credit is a learned skill, and sticking to a single credit card will make managing your credit easier.
• Check your credit score before you start using your new card. Then compare your score after a few months of use. If you are using your credit card wisely, you should see your credit score rise over time.
• Record your credit card number and the phone number for customer service and keep them in a safe place. You can use this information if your card is ever lost or stolen.
• Retain your credit card receipts and shred them when you get home. Never throw your credit card receipts in the trash.
• Keep your credit card safe. If your credit card goes missing, report the loss to the issuer right away.
Having a credit card provides enormous convenience, but it is also a major responsibility. If you recently received your first credit card, you need to use it wisely, and the tips listed above can help you do just that.