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How to Borrow Money for Things You Need

Updated on September 8, 2012

Credit Cards and Your Credit Score

Before you apply for a credit card, think about what purpose the credit card will serve for you. Are you going to use it as a convenience, so you don’t have to carry as much cash. Or are you going to use it because you don’t have the cash. There is a big and costly difference. There is a responsibility that goes along with having a credit card and you it is good to be disciplined in using it and paying for it. As part of your the many credit solutions you will face, the main one is to avoid debt in the first place, buy knowing how you will be using the credit card.. Read what you are about to sign up for. Understand what the interest rate is. If you are offered a special introductory rate, be aware of when the special rate expires. Are you signing up for something with an annual fee? Shop around and compare rates. When you get your credit card, start using it judiciously. Your aim ist to establish a good credit record through prompt payments and paying on time. When you start to establish a good credit record, the bank may offer you a bigger credit line. Did you know you can refuse it? If you are offered a higher line of credit, you can tell the bank you want it to be lower. If you do have credit card debt, pay off the highest rates as fast as you can. Avoid paying the minimum amount due.

Another credit solution is having too many credit cards. Even if you don’t use the credit cards and owe nothing on them, the line of credit counts on your credit rating and can adversely affect your credit score. As in everything in life, balance is important. Credit solutions involve having a few credit cards (including store cards) to obtain a credit score that establishes you as a responsible payer. The rule of thumb among financial experts is that your line of credit should be about 20% of your yearly income.

Credit Solutions Start with Knowing More

Another credit solution is talking to your bank about the interest rate on your credit card. Sometimes they will negotiate with you and lower the rate. It can’t hurt to ask. Never loan your credit card to someone else. Try to set up a budet, and put money in a savings account so you have money for a “rainy day”. Even the smallest amount saved with start to add up.

In addition to the common sense information there are lesser known tips for credit solutions:


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    • susannah42 profile image

      susannah42 7 years ago from Florida

      Very good advice. I wish someone would have given me this advice many years ago.