For anyone with credit cards, there are a few key tips that you can use that will help you to not only save money, but see your credit score go higher by watching your card limit, using cash - sometimes, and reading your statements each month. Use these top tips to help ensure that you're using your credit cards wisely.
Credit Card Tips
Spend wisely – with cash unless you get perks: Always spend wisely and don't spend beyond your limit. If you have cash, use it, unless you can get perks on your card. Discover and Capital One are great with offering cash back rewards incentives that you can use anywhere. Take advantage of these deals and you can use this free cash towards your balance, a gift card or to receive a check in the mail. It takes about a month, but it's a great way to get rewarded for spending.
Examine your statement: For starters, you want to examine your statement each month. There are a few key things that you want to review. For starters, look at the breakdowns for fees that you're being charged. For example, your credit card company may be charging you for a membership fee. If you didn't sign up for one you can call and have this removed. Sometimes credit card companies charge this automatically every year and it can be $60 or higher.
Look out for late fees: Make sure you're on the proper billing cycle. Sometimes when people sign up for automatic billing, the dates may change in when the amount comes out each month versus when it is due. For example, if you're scheduled to have your money taken out of the 15th of each month, but your credit card company changes the billing cycle to the first, you'll be late each month. You don't want them charging you an extra $15-30 dollars per month or more.
Watch your OTL fees: Another item to look out for is over the limit fees. If you get hit with one, check your statement to see why your card was over the limit. If it was related to a fee that they charged you – like for that membership you didn't sign up for, make sure that you have it taken off. Also check for charges that weren't yours that can take you over the limit. When they remove any fraudulent charges, the fees should be waived, as well.
Other late fees to avoid: When you look at your bill breakdown, if you go to pay it online for example, the top part of the screen may say that your bill payment is due by the 15th of each month, but if you scroll down you may see the hidden writing where it says if you pay it by 5 p.m. on the 15th. Some credit card companies such as Capital One, have come under a lot of scrutiny for using this practice and have since updated their payment pages. Companies now have to ensure that they give the time frame where it's viewable and at the top of the billing page instead of hiding it at the bottom where unsuspecting consumers won't be able to readily see it. If you were charged a fee each month, call them and request a refund.
Know your interest rate before you shop: Another key area you want to look out for is the interest rate that you're paying. Sometimes this rate can be really high depending on your credit score. If you started out with really poor credit and began using a new card to build your credit, but now your credit is more stable, that means your interest rate should be better, too. You may want to speak with your credit card company and let them know that the interest rate is too high and ask them to readjust it.
Don't go over your spending limit: Another top tip as it relates to credit cards is to make sure that you don't go over the limit by accepting offers giving you a bigger credit limit. If you run a high credit card balance each month, it's better to actually pay off your balance and have a lower balance which is more beneficial to your credit report than to take on more credit. The reason the credit card company wants you to accept that offer for a higher limit is you're going to pay more in interest based on the balance that's open.