Posts Tagged ‘Credit Card Statement’

How to use your credit card to establish a good credit history

If you’re young and just starting out credit cards are certainly convenient and can help you establish a good credit history, which will be important when you need to make major purchases down the road. However, carrying a credit card comes with big responsibilities. Here are some tips on how to use your credit card wisely.

Choosing the right credit card

When selecting a credit card, you should consider your own needs. For example, if you’re going to be carrying a balance (not paying off the entire bill each month) then it is imperative to seek out the lowest interest rates that you can find. But you may be limited by a few circumstances, one of which is your paycheque. Some credit cards require a minimum income level or charge an annual fee.

High limit credit card could be a recipe for disaster. Signing on the dotted line is fun. No money comes out of your bank account and no cash comes out of your wallet. Shopping has never been so easy. Thats why when starting out the best credit cards are the ones that have low spending limits, unless you can afford to pay for any of the charges that are made on it.

Just about all credit cards offer some type of incentives such as rewards points or cash back incentives. This is done for obvious reasons. The most common of which is to entice the cardholder into using it more often. Overall it is a pretty good deal to receive rewards for credit card charges as long as you bear in mind that this is not free money. Whether you realize it or not, you have already paid for those points.

Managing your account.

Managing your account online is a great feature; just about every body has access to the Internet and can easily access their credit card statements.

Studying your credit card statement

You’ll receive a statement that details what you’ve bought and what you need to pay. The purchases you’ve made will be tallied, just like on a bank statement. You’ll need to pay attention to:

The amounts – Make sure your purchases are listed correctly by comparing the amounts to your own purchase receipts. Doing this will help you understand where your money is being spent and help you adjust your spending patterns.
The balance – If for any reason your statement seems a lot bigger than you thought it would be, you may be heading into a danger zone. Keep your balance within a range you can afford to pay off every month. And remember to save some credit for emergencies.
The minimum payment – You need to pay this amount each month toward the entire outstanding balance. Making substantial payments every month will help you keep the interest under control.
The purchase interest – This is how much you’re paying on purchases that have not been paid off in full by the payment date. Whenever you carry a balance forward from the previous month, you’ll pay this monthly interest.
The payment date – When you are busy and responsible for many bills, it’s easy to forget when everything is due. However, paying bills on time is crucial to maintaining a positive credit record. Over time, it could mean the difference between being approved or denied for other credit, such as a car loan or a mortgage. Many credit card companies advise making payment a few days before the specified payment date to ensure receipt. Another option is to pre-pay your bills using telephone or Internet banking.

Staying out of the danger zones

It’s a good idea to avoid the following, despite the temptation:

Cash advances – You’ll pay interest on a cash advance from the moment the cash is in your hand. You may also be charged a service fee. Cash advances are great for emergency cash but avoid using them as an income supplement.
Hitting your credit limit – There are many reasons why hitting your credit limit can be dangerous. If you don’t have the money to cover your purchases, you will definitely feel the discomfort that a large balance brings.
Impulsive purchases – Think about the purchase and why you are buying. Do you really need it? Don’t let the ease and convenience of credit be the driver for purchasing the item.
Overusing the card – Credit cards aren’t a substitute for saving and budgeting. When you can’t afford to go to the movies, don’t think of your credit card as a saving grace.

Use Your Credit Card as a Tool

A credit card can be a tool that you use to your advantage. If you play your cards right you’ll prove to creditors that you are a person who can take care of business in a mature and responsible way. And a few years down the road, you’ll have a good credit history. Now that’s impressive.

Five Credit Card Billing Problems and How to Fix Them

It goes without saying that your first and best defense against paying fraudulent or unfair charges on your credit card is knowing what your bill says! When you receive your credit card statement each month, sit down with it and check each item to make sure that you actually DID purchase it. If you do run into inaccuracies or problems, there are procedures to follow to report and deal with the charges. If you don’t follow the procedure and the card company decides to notify a credit reporting agency, it could affect far more than just your balance on that one credit card. What are the most common billing problems and how should you deal with them?1.Hey, I didn’t buy that! If you notice a charge on your credit card statement that you didn’t make, take steps to deal with it IMMEDIATELY. It could be a store error – but it could be the first sign that someone else is using your identity. Heading off problems before they start is vital. Call your credit card company and report the charge that’s in error – but don’t leave it at that. Follow up with a written letter stating that you dispute the charge, and requesting that they investigate the situation. The credit card company has 45-60 days to complete their investigation and notify you of the result. During that time, they can not make any attempts to collect that amount from you, nor report you to a credit reporting agency because of it.2.Wait – I canceled that subscription!If you cancel a subscription for which you pay via credit card – to a magazine, a club or internet service provider for instance – it may take a month or two for the cancellation and ‘chargeback’ to show up on your credit card statement. Again, notify the credit card company that that account has been canceled and request that the charge be removed from the bill.3.My bill just doesn’t add up right!They’re rare, but mathematical and reporting mistakes do happen. If you notice a discrepancy on your bill between their reports and your receipts, write a letter to the credit card company – being sure to use the address for reporting credit card disputes. Include copies of both the bill and your receipts for the disputed charges.4.I returned that dress!Like a canceled subscription, it sometimes takes a billing cycle or two for charge-backs on returned items to appear on your credit card bill. Write to the credit card company and enclose copies of your return receipt, asking that the charge be removed from your bill. 5.What do you mean, there’s a late fee??Your best defense against late fees is to make sure you send your payment in plenty of time to reach the credit card company by posting date. Keep in mind that credit card companies date payments by date received andor posted, not by date mailed. Because of the effect a late payment can have on your credit card billing and your credit history, though, it’s sometimes worth a try to get them to ‘take it back’. If you have evidence along the lines of a check cleared to your bank account before the payment was posted to your account – and it’s before the late payment date, you can write to the credit card company and ask for a review of the charges.