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Acquiring a Credit Card
So you have decided to join the plastic brigade? Here are some Dos and Don’ts to keep in mind before you take the plunge.
Before you take on a credit card it’s a good idea to shop around and observe the current market. The credit card industry is very competitive, so interest rates, credit limits, grace periods, annual fees, terms and conditions vary from company to company. Find one that suits your needs best.
It’s very convenient to have a payment card that enables you to make purchases and to draw up cash, so it makes sense to find one that matches your requirements. Check out our list of Dos and Don’ts before you start shopping around.
Credit card Dos
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1. Read the fine print on the credit application. The application is a contract, so read it thoroughly before signing. Try not to skip it and watch for terms such as "introductory rate" and periods that expire. 2. Ask questions. You are the customer and the bank is providing a service. If you don't understand something, ask. 3. View credit as an investment in your future. By using credit wisely, you can build a good credit history. 4. Order a copy of your credit report annually. Your credit report is like an academic report card -- it evaluates your performance as a credit customer. 5. Be wary of anyone who claims they can "fix" your credit. The only thing that can fix a credit report is time and a positive payment history. 6. Promptly open and review your bill every month. This helps you pay your bill on time and protects you from identity theft and unauthorized charges. 7. Be careful with your credit card. Keep it secure. Always have your bank's phone number available in case your card is lost or stolen. |
Credit Card Don'ts
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1. Don't feel pressured to get a credit card if you don't want one. A credit card may not be right for you. Don't be afraid to say no. 2. Don't pay your bills late. Late payments can hurt your personal credit rating. 3. Don't spend more than you can afford. A credit card is not magic money, it's a loan with an obligation to repay. Realize the difference between needs and wants. Do you really need that CD or pizza? If you charge these items and only pay the minimum, you could be still paying for them months from now. 4. Don't apply for extra credit cards if you already have due payments on others. 5. Don't ignore the signs of credit trouble. If you pay only the minimum balance, pay late or use cash advances to pay living expenses, you might be in the credit "danger zone." 6. Don't give out your credit card number unless you've initiated the transaction. Be alert to identity thieves and scam artists. |