Credit Cards

Is it Wise to Have Multiple Credit Cards?

There are some people that have a lot of credit cards and many that have just one with some not having one at all. If you have one and are considering another then it can be wise to about whether you are making the right decision for you. There are advantages and disadvantages to having multiple credit cards and it is good to have a think about these before making your decision as to what you are going to do.

Cost

You will find that credit cards will differ in their interest rate charges. Therefore, if you see one that is cheaper than yours, you might be tempted to get it and use it so that you can have access to cheaper money. This can be a good idea, but you need to think about whether it is a good idea to keep your original card as well. If you have both then you have the potential of getting into more debt. You may decide to keep both and keep a check on the rates and then use the one that will be the cheapest. However, if you tend to repay the balance in full each month then there will be no need to worry so much about the interest rates as you will not be paying interest, but it is wise to have some idea of what is going on with them just in case you are in a situation where you cannot afford to pay them.

Access to Credit

If you need to borrow a lot of money then you may find that one credit card will not be enough. There will be a limit on each card as to how much you can borrow with them and so you might find that you need more than you are allowed to have on one particular card. How much you are allowed will depend on the lender and it may be partly determined by your credit record as well. You will need to decide though, whether you feel that this will be a wise thing for you to do. You might find that it will tempt you to spend more money than you can afford and this is not a nice situation to be in. You could end up spending too much and find that you will not be able to afford to repay it.

Repayments

It is really important to think hard about the expectations with regards to repayments. Credit cards will expect you to make a payment each month but the amount you are expected to pay will vary. You will have to a pay a minimum amount which will cover the interest and perhaps just a little more. This is likely to be an amount you can manage even if you have two cards, but it is worth checking. It is also good to think about the fact that you will really need to think hard about making sure that you consider how you will repay the balance. You will need to repay it at some point and the longer that you leave it unpaid, the more expensive it will be as you will have to keep paying the interest on it. Therefore, it could be wise to think about whether it is a good idea to have two cards with such a large joint credit limit or whether it will be easier for you to manage to repay just the one card. It will really depend on how much extra money you will be able to borrow and how much you think that you will need.

How to Use Your Credit Card to Your Advantage

Many of us have a credit card, but not all of us use it wisely. There are different things that we can do with a credit card which will mean that we can take advantage of it without having to pay for the privilege. It is perfectly within the rules of the card as well.

Always repay the Full Balance – the first thing we need to do is to always repay the balance that we owe in full. If we do not do this, we will be charged interest and this can be pretty expensive. Rates of interest on credit cards can be pretty high and therefore it is a good idea to try to avoid paying it if we can. Therefore, when the statement arrives pay back everything you need to by the date shown. If you need motivation, look at the interest that will be charged if you do not repay and calculate how much would be in a year. It will a significant sum of money and it might help you to see that it would be a good idea to repay the card in full. To make this really easy, you can set up a direct debit, so that the card issuer will take the money form your account each month. You will then not have to remember to do it, which will make things a lot easier. However. You will need to make sure that you keep a track of how much you are spending on the card so that you can be sure that you will have enough money to be able to afford to repay it when the time comes.

Take Advantage of the Security it Provides
A credit card can be good for using when you are shopping online a sit is more secure. Although it does mean that you will be handing over your card number and if someone gets hold of that they could spend money on it, it is more secure than you bank account details. With your credit card you can quickly put a stop on it and the money spent will be refunded to the card. If they get your bank account details they could steal money that is actually yours rather than loaning it on the card and it may not be so easy to get it back. There is also insurance with a credit card, so if you buy something online and it does not turn up or you cannot get a refund even if it is damaged or whatever, you will be able to get the money back through the credit card. Therefore, it can be very handy to have one.

Try a Reward Card
There are credit cards which give you rewards for using them. These can be really great, but only in certain circumstances. The cards can be more expensive than standard cards, so if you pay interest then it is better to stick to a conventional one. They also might encourage some people to buy more things. It is okay to use your card for more things, as long as you are buying the same amount but just using your card to pay, rather than other means such as cash or a debit card. Then you will get more rewards as they tend to be a percentage of what you spend on the card. You will need to monitor it closely though and make sure you will definitely be able to afford the repayment. Keep checking the balance and ensure you keep money back so that you can afford to repay the card.

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