10 Things You Should Know About Credit Cards

Written by Terry J. Rigg


Maybe these 10 items may answer some questions you have about using credit cards. Make sure to check outrepparttar link in #1.

#1. Don't Use Them.

Credit cards accounted for 1.3 million Americans filing bankruptcy in 1998.

#2. If you use credit cards pay them off each month.

Carrying a balance on your credit cards could add up to hundreds of dollars each year in interest and penalties.

#3. If you can't pay off your credit card balance each month, pay as much as possible.

Every extra dollar you pay overrepparttar 110355 interest charges goes toward paying offrepparttar 110356 principle. Minimum payments are 90% interest and 10% principle.

#4. Never obtain a credit card based on an introductory interest rate.

Introductory interest rates are strictly bait to get you hooked. After a short period of timerepparttar 110357 intro rate increases substantially.

#5. Be careful consolidating your credit card debt.

Whether you use equity in your home or find another credit card to lower your interest rate, there are things you MUST DO. If you pay off a credit card you are going to receive constant offers, either checks inrepparttar 110358 mail or special offers, to use that credit card again. Be sure to cut uprepparttar 110359 credit card you paid off and contactrepparttar 110360 company to cancel.

#6. Do not obtain credit card protection.

Many credit card companies offer credit card protection for a fee. This is normally a percentage ofrepparttar 110361 outstanding balance. According torepparttar 110362 Federal Trade Commission, (http://www.ftc.gov/bcp/conline/pubs/alerts/lossalrt.htm) you are only obligated to payrepparttar 110363 first $50 when your credit card is used by someone unauthorized. You could easily pay several timesrepparttar 110364 $50 for credit card protection in a year.

Crisis Fund

Written by Terry J. Rigg


What would it be like to have a pot of money available when you have an unexpected expense? I used to think that unexpected expenses was something that happened very rarely. But it seems like these days I have as many unexpected expenses as I do regular bills. One ofrepparttar vehicles is always needing tires or repairs,repparttar 110354 washing machine needs replaced or buying a new water heater (like I did just last week). That is whererepparttar 110355 Crisis Fund comes in.

If you have a budget in place, most of your regular paycheck is already allocated for something. Ideally about 10% should be put aside for savings. It would be a good idea to use about half of your savings for long term savings and half for your crisis fund. Your long term savings would be used for large purchases like a home or money for college forrepparttar 110356 kids while a crisis fund would be used smaller purchases.

Your long term savings can be invested in many ways to yieldrepparttar 110357 best interest rate you can find sincerepparttar 110358 money is intended to be tied up for years. Your crisis fund needs to be in a savings account or a checking account that earns interest to makerepparttar 110359 money available on short notice.

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