Credit Card Do's and Don'ts

Statistics show that today there is more than $900 billion of debt being carried by consumers. This is mostly due to home foreclosures and homeowners using credit cards to pay for mortgages, food, gas, and other necessities. Debt is a reality in our society, and one of the best ways to decrease this staggering statistic is to understand some basic do's and don'ts where the use of credit cards is concerned.

The Do's of owning a credit card:

• If you're deep in unsecured credit card debt, keep one credit card for emergencies only; cut up the rest.
• Pay more than the minimum amount due each month or, if you can, pay the entire balance.
• Pay your credit card bill on time – earlier, if possible.
• Reduce your interest rate by calling the credit card company and requesting it.
• Pay for items with cash.
• Keep your credit card debt at 50% or below your credit limits.
• Destroy credit card applications received in the mail. Simply throwing them away could make you a candidate for identity theft.
• Keep track of your expenses by maintaining a budget.

The Don'ts:

• Don't carry a credit card with you; you won't be tempted to make purchases that will only deepen your debt, and you won't inadvertently lose it somewhere.
• Don't shop online unless you're sure of the website's security.
• Don't apply for in-store credit cards; they usually carry high interest rates. Besides, most stores accept the major credit cards, so you don't really need the smaller cards anyway.
• Don't cancel credit card accounts even though you owe nothing on them. It could hurt your score, especially if you close older accounts.
• Don't charge anything unless you can pay for it in full.

Of course, these are just some of the do's and don'ts you should be aware of when using credit cards. But the true key to handling your debt successfully is to be financially responsible.

The mortgage meltdown is having a devastating effect on the economy. Moreover, food and gas prices are rising every day and those in debt are undoubtedly feeling it even more than others. Everyone is concerned about the state of affairs as it relates to their own financial condition. More and more banks are reducing the amount of credit they'll give to consumers, and economists are prophesying doom and gloom at every turn.

This is the time when we all must buckle down and reduce as much of our debt as possible. The most prudent thing that we can do for ourselves and our family is to budget our finances, reduce expenditures wherever possible, and pay down unsecured credit card debt as much as we can. For many, hard sacrifices may have to be made. But if we'll all keep one simple maxim in mind, which is, "if I can't afford it, I shouldn't buy it," eventually we'll begin to see light at the end of this current gloomy tunnel.