Using Credit Wisely

Too many people get credit cards and think of them as “free money”.  There is no such thing as free money and I’ll just get it now and pay for it later is a mind set certain to lead you into financial disaster.

I carry one card.  One.  I keep it in case of emergency.  Every three or four months I charge something on it and then pay it off in full, immediately.  The longer you wait to pay for an item, the more interest you are going to accrue and the more that item is going to cost.  The reason I charge something and then pay it off pronto is to keep my card active and keep my credit rating looking good — in case I should ever have an emergency that requires credit.

The banks that put out credit cards actually want you to misuse them.  That’s how they make their money — by charging you more and more and more. For that reason, you need to be alert when you are applying for credit and filling out credit card applications

  • Make certain you know what your interest rate is at all times.
  • Do not use your credit card for luxury purchases if you can’t pay the items off quickly.
  • Be skeptical of 0% interest rate offers and make certain you wholly understand to the date how long that offer is good, and what the interest rate will revert to at the end of that window.
  • Misusing your credit card is the fastest way to bury yourself in unmanageable debt.

If I sound to you like I am someone who knows what I am talking about, it is because I have “been there and done that”. I got myself through college using credit cards, then spent the next five years scrimping and saving to pay them off. I worked three jobs. One fed and clothed me. One made my car payments. One paid my credit card debit. I was working 12-15 hours per day, 7 days per week, to pay for things long consumed. It isn’t a mistake I will make again.

If you have credit card issues or questions, the U.S. Department of the Treasury has a website you might wish to peruse: You can find explanations for credit terms, credit laws, credit management techniques, dispute procedures and much more with just the flick of your mouse.

Remember, spending beyond your means will not help you live well. It is very hard to enjoy your luxuries while you’re stressed wondering how you’re going to pay for them — or while you’re off working at the three jobs it takes to keep them from being repossessed. If you must use credit, remember it is a tool. Educate yourself on how to use it wisely.