5 credit card mistakes to avoid

Unwise or irresponsible use of a credit card can wreak havoc on your finances, especially if you commit these potentially costly errors.

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Nov 23, 2012 12:11PM
Let's see - I pay off the card in full each month and get dinged for 'not enough information on revolving payments' - then 'too much credit available' (potential debt) and then if I cancel a card, I will get a 'why did you do this? We are going to ding you score again.'

I'll do it my way - I continue to pay it off each month..... and only use reward cards with no annual fee.

Nov 23, 2012 11:46AM
It doesn't matter if you pay your bills on time or not when it comes to your credit rating.  My latest insurance renewal informed me that they were required to tell me by law that I wasn't getting the lowest possible rates because of information contained in a consumer report:  number of accounts marked paid as agreed.  Ha!  all my accounts are marked paid as agreed.  I pay all my bills on time. My FICO score was 823 last time I checked.  It don't get much better than that.  I doubt a perfect score is possible.  You should pay all your bills on time.  If you can't, you deserve what you get.  But, when you pay your bills on time and still get stiffed, well that's just plain American business fraud which is done under the guise of consumer reporting.  Nothing fair about it.  
Nov 23, 2012 11:33AM

In my opinion, it all boils down to self control. Self control is the ability to tell one's self  "No you can't", or " Not now, maybe later, if, and when it becomes feasible for you and your circumstance".

Self control is indoctrinated in one's children during their formative years.

Because it seems to be considered anti-establishment by some, and at the same time anti- liberal (realistically conservative) by others, it is not available as p.s. k-12, or university cirriculum. Thus, it becomes the responsibility of the individual to be self learned. True, it is basic will power, but where do you imagine that comes from? Or the lack thereof?



Nov 23, 2012 10:31AM

Credit cards is an excellent way to get and stay in DEBT.


Nov 23, 2012 7:51AM
So many people don't have a clue how to use a cc to their advantage.  Banks pay me to have their card, not the other way around, that is, I pay LESS for my purchases than using cash every month by taking advantage of their perks and paying them off every month.  No annual fees, no interest rates, just money credited to me each month.  It is not rocket science-it's called a budget.

Bruitsbear5:  Yes, there is such a thing as free in the credit card world.  People who pay their bill in full each month are rewarded by those who don't.  
Nov 23, 2012 12:50AM
In terms of credit, credit cards are the bicycles of borrowing (with loans/unsecured lines being cars and mortgages/equity being planes). Maxing your credit line or carrying a high balance is like taking that bicycle from New York to L.A. Is it possible? Yeah. Is it wise? Absolutely not. If you are carrying a balance on your card for more than 3 months you're doing it wrong.
As a banker, the recommendation I make to each and every one of my customers is to only use credit cards for two purposes: Monthly bills and extremely short-term purchases. Cell phone bills, electric bills, cable bills are all expenses you have EVERY month without fail. Have your credit card pay them automatically and pay that card IN FULL every month. Now you only have one bill due each month (the credit card, preferably set for the middle of the month) and your getting positive credit reports twice (for the utility and the consistently paid revolving line) without generating any new expenses! As for those short term purchases? You need gas in your car today but your paid next Friday? Use the card and pay it off immediately when your paycheck comes in.
Credit cards are fantastic products both for businesses and individuals when used CORRECTLY. Just make sure your balance is 0 at the end of the month and you'll never have to put a dime towards interest.
As a final word, Credit cards need to be open at least 7 years before they are completely beneficial to your credit (your financial reputation of honesty and dependability). Never EVER close a card that has no annual fees. Pay the balance off then cut the card up. The preferred age that lenders look for in a revolving line is 40 years, so let your cards work for you.
Nov 22, 2012 10:28PM
Mistake #1: Getting one
Mistake #2: See #1
Nov 22, 2012 10:14PM

Some people make me smirk really. I understand using a creditcard may increase your tendency to use money than paying with the actual money, but then how is that going to help you to build up the credits? For instance, what if you're planning to purchase a new car, or a house in the future? You're always better off with good credits in real life. Yes, it can be a bad idea if you have  spending problems obviously, however there are plenty of creditcards that offer cashback too which I find it very good. It's simple people. It's a borrowed money, so you MUST PAY IT OFF. If you can't afford pay it off, then cash is your best option.

Nov 22, 2012 9:38PM
It is always so easy to give advice and be critical about how to do it.  However, if you are in an unforseen predicament and have to use them to survive because of the current job market it is so much easier said than done.  Reality is it is mostly people who have lost their jobs due to the current economy who have been forced to turn to credit cards. No reasonable answers for those in that situation have been given. Credit cards are pretty much unregulated and they will do what they darn well please putting; balances way out of reach for some. The economy today is so much different  from periods experienced before and who knows when we will get out of current depression like phase. Don't place judgement on all those having financial hardship and having to turn to their credit cards. Try actually walking in their shoes in this employers choice job market. 
Nov 22, 2012 6:40PM
I use one credit card for pretty much everything.  This means I earn enough reward points to get a partner card using my points for a nice dinner about every other month.  Not a bad deal.  Free dinner just for using other people's money.  
I'm 80 years old and never used a credit card in my life. if you don't had the money to pay for it then you don't need it just work hard and save that how you live a lone happy life
Nov 22, 2012 5:48PM
Credit cards are good for online purchases.  Debit cards are best for day to day.  They are less bulky than cash, and keep a low balance in the debit card account.

Nov 22, 2012 2:50PM
I have a Discover card at around 10% interest plus 3 other bank cards, I used to have problems with credit cards about 15 years ago, sending in the minimum payment every month, running up debt beyond $6,000.00.
Since then I have rules: I never charge more than I can pay for, I pay in full every month, if the item is less than $100.00 I pay with cash.

Nov 22, 2012 1:51PM
Nov 22, 2012 1:19PM
we live off of our discover card and pay it off every month. using someone else money interest free for 30 days is a good deal. we use our card for any and all purchase over $5 and pay all our monthly bills with the card to get the perks.
Nov 22, 2012 12:22PM
Here is one credit card rule I follow: I don't have one!!! I use cash or my debit card for EVERYTHING and have been for years. Cash hurts to spend. Plus, you can negoiate better deals with cash. I have no credit score, but my net worth is high. Credit is a myth.
Nov 22, 2012 1:16AM
The goverment should follow these tips,don't spend other peoples money we don't have,especialy giving it away to countrys who hate us...sometimes unless you have a cc,,you cant purchase items or services. The late fees should be against the law..they are rediculus
Nov 12, 2012 5:34PM
Ignore the smarmy bragging of elitists who fit the mold and screw the status quo any way you can get away with.
Nov 12, 2012 5:33PM
I love using credit cards. I use it every time everyplace that accepts credit card. It really depends on how you use it. If u use it wisely, you will have a lot of benefits. I will tell you the TRUTH that I have earned a lot a lot and A LOT of hotels points. In addition, I dont have any credit card debt. I haven't paid any interest since I entered the credit card world. My Fico score Transunion is 770 for this month. If you dont know how to manage your credit cards, you need to find a book to teach you how to mange credit cards. Otherwise, you must use cash only but you will lose a lot of BENEFITS. My final word is that I love love and LOVE using credit card ^_^
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