Credit card tips: what you need to know

Six credit cards
KJ: Lists, lists, lists. There are so many out there, but we keep coming across some great ones that will help you get on solid financial footing. In this post, we focus on Bank Rate’s 10 can’t miss credit card tips. Go ahead, read the full article. You’ll be amazed what you can learn in just a few minutes that could save you hundreds – or even thousands – over time!

AJ: I LOVE when Kirby finds articles that teach me things I don’t know. As an avid credit card user there are a ton of great takeaways in this article and even better reminders of things that make us successful credit card carriers.

Here’s our key takeaways that we felt were worth sharing:

Pay your bill twice a month
This is recommended because it keeps your credit card utilization low – one of the key factors in calculating your credit score. The lower your utilization (say you have a balance of $1,000 on a $10,000 limit that has been extended to you), the better your score. An alternative would be to put less on your card and/or see about having a higher credit limit at your disposal. The latter could get you into serious trouble though if you don’t use a program like Mint.com to track your expenses and then pay your card in full each month, so beware.

Personally, I think this one more comes into affect when you are looking at purchasing a home, buying a car, etc. where your credit score is most front of mind and some type of long-term loan is on the line. Our preference to this is keeping higher credit amounts available to us, but just not using it.

Know card’s anti-skimming features
The regular mag-stripe on many credit cards could put you at potential risk with how easy someone can swipe your data. Try looking for credit cards that use the EMV technology that encrypts each and every transaction. Know how exposed you may be, and make changes as needed to help make sure you are protected.

Know your fraud protections
The Fair Credit Billing Act limits your liability with a credit card to $50 (and zero if it’s a data breach and only your credit card account information is stolen). Be sure to watch your expenses regularly and dispute any charges (maybe that waiter bumped up the tip a little more or a mysterious charge shows up). No one should be watching the transactions come across as closely as you!

Be aware that debit card liability limits often aren’t as great – and there are some significant differences in your potential liability. That’s why we prefer to use credit cards for all purchases and pay the balance in full each month.

Don’t pay for your cash back
Don’t get a rewards credit card and then not pay it in full each month. As we’ve written in the past, any amount you let carry over from month-to-month will very quickly eat into any benefits you thought you were getting!

Take stock of your wallet
This one’s pretty simple. Make a list of the cards you have in your wallet. Determine if any accounts need to be cancelled and closed. Check to see too that your spending pattern matches the best cards available today. Just because you opened a card years ago for rewards in a certain area doesn’t mean that it’s the best choice for your current lifestyle!

Be cognizant that closing a card can impact your average credit history and your available credit balance. Not that you shouldn’t do it, just be aware how it may impact your financing needs in the short-term if there is something on the horizon (say a move and new home purchase).

AJ: I am terrible at paying attention to what’s in my wallet. I’ve never lost a card (knock on wood), but things in my wallet are all kinds of expired, closed or invalid. Everything from insurance cards, benefits cards and credit cards, so thankfully Kirby is the king of maximizing credit card benefits in our house so he keeps us in the know on how to maximize our spending. All I have to do is remember which card I’m supposed to use on gas and groceries versus other expenses this month and we’re set!

Know what car rental insurance to take
Read the fine print on your cards! Many of your cards may cover rental accidents and damage, so don’t pony up for something you don’t need. Each card is different with what they cover, what deductible there may be, and whether international travel is covered, so be sure you know the stipulations.

AJ: This is completely new information to me! I love learning new things!

Know how to dispute a purchase
Be sure to check how to file a dispute with your credit card company if the goods and services aren’t up to snuff. Don’t avoid conflict in this area. It’s your money, so don’t let a retailer pull one over on you if you’re too timid to fight it and something was legitimately wrong (read damaged or incorrect product or price). Try to resolve it with the retailer first, and if it isn’t resolved, then work with the credit card company as needed.

    What credit card tips would you add to the list?
    Share with us your credit card must-knows.

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3 thoughts on “Credit card tips: what you need to know

    • Thanks Clarisse! Using cash is a good way to build good habits, but once you learn those good habits, then using a credit card can be a great way to maximize your rewards. Just have to be much more careful with credit cards that you aren’t spending more than you’re bringing in and that you pay the card in full each month!

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