Loan Deposits

Using credit card unfortunately does not come with a manual. Credit card companies fill potential applicants with applications and pre-approvals, but no manuals on how to stay out of debt. You may wonder why this is – but credit card companies do not make money from the consumers that repay their debts each month, credit card companies make money from the consumers that carry a balance from month to month.

Here are some rules that every consumer should take advantage of while using their first credit card:

Never Miss a Payment
Missing a payment towards the credit card can cost you. Each time that a payment is missed on the account the card holder is charged a flat fee of $39.00. Keep in mind that this fee is charged for each billing period that a payment is missed. Aside from this fee, the credit card company will often increase the interest rate of the consumer because of the missed payment – remember, one missed payment could cost you the interest rate!

Don’t Spend More than You Can Afford
There are certain things that you should not put on the credit card. These items that are variable expenses and that the consumer has no intention of repaying within the month should be avoided. Everything from vacations to luxury items or clothing and gifts should not be placed on the credit card because if the consumer is unable to pay cash for these items than there is a good chance that they should not be purchased.