Skip to main content

5 Smart Ways to Use Your Credit

It’s no secret that we Americans love our credit cards. But unfortunately, the relationship isn’t always healthy. Research indicates that the average American household has $6,270 in credit card debt. And while there’s no magic bullet solution to erase debt once you have it, there are several smart steps you can take to make sure you don’t get in over your head.

1.  Use It Sparingly

 It’s easy to overspend with the unlimited freedom of credit cards. This can be dangerous because you can end up accruing thousands of dollars in debt, which comes with even more interest if you don’t pay it off immediately. It’s good practice to use credit cards only when necessary or to help build your credit score, so stick to cash and other direct payment methods to avoid collecting debt unless you plan to pay the money back immediately or at the end of each month.

2.  Pay the Full Balance

Unless you’re saddled with thousands in credit card debt, try to pay off the balance as it accrues. Credit balances accrue interest over time. Avoid these accruals and pay as much as you can, when you can. The best thing you can do is to pay it off as quickly as possible, which will also help raise your credit score.

3.  Leverage Rewards 

Many cards offer bonuses, such as fuel points, airline miles, or other benefits. Leveraging these rewards can help you get more bang for your buck. These rewards can help you pay for family vacations, gas, or even new decorations for your home. If you’re going to use your card anyway, why not rack up a few extra perks while you’re at it? Beware of these types of credit cards if you have trouble paying it off quickly because the interest rates tend to be much higher than other credit cards.

4.  Examine Card Options

If you’ve established a good credit history and are still using a starter card, you likely qualify for a credit card with a better interest rate or better perks. The best piece of advice is to stick with your credit card for at least a year before trying to upgrade your credit card or credit limit. Examine which card options, like the Gulf Winds Visa Platinum Credit Card, are available to make sure you’re getting the best deal possible.

5.  Protect Yourself

Credit card fraud and identity theft are all too common these days. Many cards have built-in protections for such events, but it’s still a hassle to sort through if it happens. Keep an eye on your credit card statements, even if you don’t use the card often. The faster you catch fraud on your account and alert your member advocates, the more likely you will be able to recover you name and money quickly. If you do see fraud on your account, make sure to contact our fraud reporting center immediately. You will have 60 days from the time you receive a statement of your suspicious charge to report it.

6.  Smart Strategies for Credit 

Credit cards are great tools for financial management, but they must be used with care. Keep these five tips in mind the next time you use your card and always keep up on your balance to stop yourself from falling into debt. If you haven’t started your credit card journey yet, or if you’re ready for a credit card update, contact your member advocate at Gulf Winds today to see how we can best help you live a healthy financial life.

Subscribe to Our Blog

Get the best of the Save. Spend. Live. Blog and other helpful financial education resources straight to your inbox. Sign up today and start living your best financial life.