Understanding Credit Cards: Do’s and Don’ts

✅ The Do’s of Using Credit Cards

1. Pay Your Balance in Full Each Month

   • Avoid interest by clearing your statement balance.

   • Treat your credit card like cash, not borrowed money.

2. Make Payments on Time

   • Late payments hurt your credit score and lead to penalties.

   • Set up automatic payments or reminders.

3. Use Credit Cards to Build Credit

   • Regular, responsible use boosts your credit history.

   • A strong credit score means lower interest rates and better loan approvals.

4. Take Advantage of Rewards

   • Many cards offer cashback, travel points, or discounts.

   • Use them smartly, but never overspend just for rewards.

5. Monitor Your Statements

   • Check for errors or unauthorized charges.

   • Tracking spending also helps with budgeting.

❌ The Don’ts of Using Credit Cards

1. Don’t Max Out Your Credit Limit

   • Keep your credit utilization below 30%.

   • High balances hurt your credit score even if you pay on time.

2. Don’t Make Only Minimum Payments

   • This keeps you stuck in debt and racks up interest.

   • Always aim to pay more than the minimum.

3. Don’t Take Out Cash Advances

   • Cash withdrawals often come with high fees and immediate interest.

   • Use your debit card for cash instead.

4. Don’t Open Too Many Cards at Once

   • Each application lowers your credit score temporarily.

   • Stick to cards that truly match your needs.

5. Don’t Ignore Terms and Conditions

   • Be aware of annual fees, interest rates, and hidden charges.

   • Reading the fine print prevents unwanted surprises.