Just been sitting here and thinking, is it possible to write another guide,that may be useful to someone.
Decided I may be able to give some useful hints on the use of credit cards.If you know how to use a credit card the correct way they can be very good.
If you use them the wrong way they are very harmful.
I don't think credit cards even existed till I was about 25,
Naturally I was one of the first people to get one.
The limit was $1000 and I thought at the time, Hey how good is this ?
I have $1000 to spend on anything I like, forgetting of course it was not my $1000.
I then proceeded to pay this money back at the minimum amount,
10 years later I still owed $1000.
I met a new friend at that time and we were discussing credit cards,I said I thought them a dumb idea that I had been paying back one lousy $1000 for the last 10 years, possibly paid it back 3 times over.
Here is what she told me and I have been using credit cards this way for all the years since then and there have been quite a few.
Whatever limits you have, always buy the things you need or want on the first day of your billing cycle.
If your billing cycle starts on the 28th of the month do your buying within the next week.
Always try to put aside over the next 6 weeks, the amount you have spent,then when the bill comes in you pay the full balance, not a minimum payment.
You may wonder what benifit there would be in having a credit card at all.
The benifit is large if you think about it; you are using someone else's money for 6 weeks.
It's a huge benefit if you are in business too, because you can buy all your things no matter what business you are in on your credit card and in that six weeks you may have either completed a job with the things you purchased on your card, or if buying stock for resale you may have already gotten all your money plus profit, back from your purchases.
The same can work for people who have their credit cards registered with pay pal.
Buy your items just after your cycle begins.
The strategy with a credit card is to use the banks money and pay no interest for using it, if you do it this way you will always be in front.
I know I am.
If by some chance you find you cannot pay the full amount at the end of each month Then it would be wiser to look for a card that has a smaller interest rate.
Or alternatively if you have a few cards, the wisest course is to try and get them all transferred to a personal loan with a cheaper rate.
What you should not do is have them all transferred to a new credit card which a lot of finance places will offer you, telling you that they will take over all your existing cards and give you 6-12 months interest free on the existing debt, while upping the final limit by an extra $3000, which you will immediately go and spend, making your debt $10,000 instead of the original $7000.
I am afraid my silly son against my advice did just that because he wanted to buy a Parachute, now after 3 years of not being able to get rid of the debt, he hands it to me and asks if I will pay it for him.
One more benefit of using a credit card the correct way is to join the frequent flyers.
If you put all your bills, purchases and anything else you can, on your card. Keeping your cash that you would normally use aside to pay your bill when it comes in and paying on the very last day its due, you will build up points very quickly for a great holiday or even a large purchase.
We manage to get at least one free trip to Bali every two years.
You do of course need to have a bit of discipline to do this.You must keep all your wages and just use the card, then when the bill comes you have the money to pay for it.
Good luck Margo