VIEWS: 41 PAGES: 1 CATEGORY: Personal Finance POSTED ON: 9/28/2012
Not everyone in the world have their own credit cards. Credit cards are becoming every person’s lifestyle. People get to use it for emergencies and they prove to be very helpful to. However, the use of credit card’s affect people’s credit rating in good or bad ways.
How Credit Cards Can Affect Your Credit Rating? Not everyone in the world have their own credit cards. In fact, based on a study, 25% of Americans don’t have credit cards. But on the other side, most people have more than one credit card and in the average, they hold about four cards. And only 15% of the population holds more than 10 active cards. Credit cards are becoming every person’s lifestyle. People get to use it for emergencies and they prove to be very helpful to. Those without credit cards would seem that they are left behind, but that isn’t actually true. What’s helpful about credit cards is that you can make purchases even if you don’t have cash with you. This will protect you against unauthorized purchases and the risk of losing your money with be lessened. As we all know, credit cards reproduce rapidly. People would often start with one credit card then the next thing you know, they already have a credit card for every store you’ve ever been to. However, the use of credit card’s affect people’s credit rating in good or bad ways. First of all, if you use your credit a lot but don’t pay your bills on time at the end of the month, you will end up hurting your credit score report and your credit rating. Owning a credit card means you have to be responsible for all your actions and everyone who has one should know that. Missing out on your bills is an easy way to let your credit down. Did you know that in order to get the best points for your credit, you have to stay below your credit card limit at least 20%? Here are some tips for you to follow to maintain a healthy credit score while using your credit card. Always keep track of your credit report to know if everything on it is correct. Errors on your credit report will only do more damage if let to linger. Get your free credit report every year from the three credit agencies to easily keep track of it and to make sure that you are updated all the time. Do not forget to pay your bills on time and regularly. Again, missing out on your payments is the easiest way to hurt your score while paying on time is a quick way to give it a boost. Use your cards sparingly. Even if you can purchase items easily without any cash, it doesn’t mean that your credit card is indispensable. If you have enough cash with you, use it. It will help you cut down on your bill and at the same time, you’ll be able to practice your being financially responsible. Your credit card is not free money; you have to pay for it at the very end of the month. That is why it is best to use it for emergency purposes only. The affect of credit card on credit score depends largely on the type of credit card you use. Credit cards can increase or lower your credit rating. So, to avoid the latter one increase your credit score and make all your payments on time.
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