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Smart ways to use your credit cards

When you use credit cards, they can help you have a healthy financial picture. Your personal finances can be kept in order with credit cards; you just have to be smart about the ways you use them. You need to be wise with them, and here are some wise ways to handle your credit cards.

1. Think about how many credit cards you need. Don’t get all the credit cards you can just for the sake of having credit cards. Think carefully about which cards you absolutely need. Maybe you need a card for emergencies, and maybe you would like a card with rewards. Try to keep one to three cards; that should be enough for most people. Once you determine how many cards you need, close the accounts of the other cards.

2. Try to pay as much as you can of your credit card balance each month. If you find yourself struggling every month to pay your credit card bills, you need to think seriously about your need for credit cards in the first place. Never pay one card with a cash advance from another card; the fees you pay on the cash advance aren’t worth it.

3. Think about how you use your cards. Are you using your credit cards every time you want to make a big purchase that you can’t afford in cash? Think seriously about every purchase you make. If you want a big ticket item, take 24 to 48 hours before buying it. Think about whether you want to pay for it for months to come, think about whether you want to pay interest on it, think about whether you want to refuse yourself other items to buy this one thing. Then and only then should you make that purchase.

5. Monitor your feelings about your credit card bills. Do you get nervous when you see the envelopes in the mail? Are you stressed out every time you see the bills? Do you feel overwhelmed with how high the bills are? If this is the case, stop using the card for purchases and start thinking about how you can best pay off the cards. Stress can be damaging to your mental and physical health, so don’t give yourself more stress by running up credit bills.

6. Consider whether you can afford the credit cards you have. If your income is not going up, but you find that your credit bills are getting higher, try to cut spending before it gets out of control. Most people keep thinking that things will turn around in the future, but if things are not changing and you find yourself depending on your credit cards more and more, stop using them or find other ways to bring in more income.

As long as you keep these tips in mind, you will be able to better handle your credit cards. Just monitor your spending habits and patterns, and you will be able to make sound decisions about your credit cards and the rest of your personal finances.

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