I was just on the ING Direct site checking out my savings accounts and decided to check out their tips. They list seven great credit card tips. Check them out (descriptions are mine):
- Make your payments on time – Very important! Late fees can be very expensive on credit cards and can negatively affect your credit score. If you have problems with the due date you may be able to change your credit card due date.
- Try to pay off the full balance every month – Pay off the full balance to avoid any interest charges.
- Avoid cash advances – Cash advances on your credit card have different rates than normal credit. Yeah, it’s gonna be more expensive than if you just charged it.
- Shop around – Compare rates and services from different credit card companies to get the best credit card offers. Find one that fits your spending habits. Make sure to read the fine print as well.
- Use savings to pay off the cards – It’s great that ING Direct exists offering high interest rates on savings but that high rate doesn’t compare with the interest on your credit card (unless you have a low introductory rate).
- If you’d like a better rate, just ask – If you have been a good customer you can call the credit card company and ask for a better rate. Try telling them that you received an offer from another company with a better credit card rate; odds are they can lower it for you. Make sure you understand what the new rate is though. It may only apply to new purchases not your outstanding balance.
- Don’t be left holding all the cards – If you have a lot of cards it means you can do a lot of spending damage. This is bad for both you wallet and your credit score. Get rid of credit cards you hardly use or ask that the credits limits be lowered (a high credit limit can hurt you for some credit card companies).
Of course you should also watch your spending as well. Don’t abuse your card and know what you can really afford.
Wow. That’s actually really impressive that they release that info. Most credit card people are out to GET you. You actually have a credit card with them, or just the savings account? Those are all really good recommendations…
Free From Broke says
Yeah, kinda strange – a bank helping? I don’t know if they have a credit card. I currently have savings, CD’s, and a Sharebuilder account with them.
I have a credit card w/ Captial One and they basically did the same thing. They gave me some tips through the mail to help increase my credit score.
One thing they mentioned that is different is to don’t charge over the 1/2 way mark. In other words if you have a credit card w/ a credit limit of $500 don’t charge more than $250. Keeping it this way will actually increase your credit score.
Free From Broke says
@ Anon – I’ve heard that before. I believe it’s your debt to credit ratio. It looks bad when you’re maxed on your cards.
It would seem that many credit card companies are out to get us, but I don’t think that is the case. I think many rely on cards for expenses and they get caught on the debt treadmill.
These tips are great advice, as usual.
Sorry I’m late to the party. This page came up on a search. The advice to either get rid of credit cards or lower credit limits is bad. You should never ask for a lower credit limit, unless of course your credit score is secondary to your out of control spending. In which case you should not even have a credit card. You can certainly cut cards up, but you should not cancel them. Cancelling cards and lowering your available credit (both do this) are bad for your credit score. Simply cut them up if you won’t be using them. The other tips are of course always wise to follow.
yo m says
dbellis is right. having a high credit limit is actually good, and so is having credit cards. don’t close old credit acc’ts, that will do more harm than good.