Your First Credit Card - The Unwritten Rules

It seems that in America, living on credit is the way of life. Making purchases with our plastic when we are all out of paper is all too tempting. Credit cards make living easier, but that can change in a heart beat if the cards get misused. Using the card without thought can pile on the debt way beyond what you may be able to handle. It is all too easy to get a credit card thanks to the numerous pre-approved offers that we are sent. Rewards programs mask the fee and interest rates that are hidden the fine print. These can be changed at the whim of the creditor, but it is seductive when they are willing to give you card after card.

One can protect themselves by preparing before getting a credit card. You can avoid digging yourself an inescapable financial hole by considering the unwritten rules. Talk to family and friends about how to rightly use a credit card, as they can be good examples to learn from. This is true more so if their credit is spotless. If their credit is poor, then they are still worth learning from in terms of what not to do and how to avoid the problems that they got themselves into.

Make a budget and have a place in it for the credit card. This can be a simple as a ledger sheet or spreadsheet where you list where your money is coming from and where it is going. Using this sheet as a guideline, you can figure out how much you can spend on the card, taking into account anywhere from 10 to 30% interest. Pay off the card completely every month, debt that sits there costs you money. Prioritize your bills, putting food, electricity, heat and rent well before your credit card. If you have little remaining money, try to avoid using your new card except for the dire emergency.

If you already have debt, then attack it immediately. Call creditors, explain your situation and see what they can do to help you in this situation. Some may give you time, while others will lower the minimum for payment. If you are being seen as making the effort to fix the situation, then you can establish a good relationship with your creditor. Keep them up to date on contact information and do not make it a chore for them to contact you. Be proactive in fixing your debt and contacting your debtors and informing them that you care about the situation. That way they will not feel the need to hassle you.

There are a number of routes one can go with a credit card, and it is a mistake to treat it as free money. Learn from your friends and relatives, despite their score being good or bad. Stay within what you can afford, and if you fall behind, stay in touch with your financial institutions, and you will find credit cards much easier to have and keep.

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