5 ways to use your credit card wisely

Published on November 24th, 2020
  Written by 
Bill Tsouvalas
Bill Tsouvalas is the managing director and a key company spokesperson at Savvy. As a personal finance expert, he often shares his insights on a range of topics, being featured on leading news outlets including News Corp publications such as the Daily Telegraph and Herald Sun, Fairfax Media publications such as the Australian Financial Review, the Seven Network and more. Bill has over 15 years of experience working in the finance industry and founded Savvy in 2010 with a vision to provide affordable and accessible finance options to all Australians. He has built Savvy from a small asset finance brokerage into a financial comparison website which now attracts close to 2 million Aussies per year and was included in the BRW’s Fast 100 in 2015 as one of the fastest-growing companies in the country. He’s passionate about helping Australians make financially savvy decisions and reviews content across the brand to ensure its accuracy. You can follow Bill on LinkedIn.
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A credit card can help you build good credit if used wisely, to access the most important purchases that you will make such as a house or a car later on. However, not knowing what to look for in a card and the fees that come with it can cause you to get caught up in a debt trap that can get harder to get out of. Here is a list of money smart tips that can help you manage your credit card like a pro.

1. Find a card that is good for you

Getting a card that matches your needs is one of the ways that you can manage your credit card and stay on top of your finances. With so many offers on the market from various lenders when it comes to credit cards, it is possible to snatch up a card that has all the right features and special concessions. By comparing cards, you can access cards that do not come with a yearly fee. You can also compare cards that have no application fee and has the lowest interest rate the market has to offer.

2. Watch out for hidden fees

Some credit cards offer tempting interest rates, but before you sign up check to see if there are any hidden fees. Thankfully, the law is on your side when it comes to protecting you from hidden fees as all banks issuing credit cards are not permitted to hide any charges. A few fees that you can keep your eye out for when applying for a credit card are fees like; late payment fees, balance transfer fees, processing fees, transaction fees, and fees for exceeding your credit limit.

3. Use your power to negotiate a lower rate

Having a good credit card rating can open doors to a card with better features and a lower rate from other banks and lenders. Using comparison sites or approaching other lenders to see what other rates are out there can help improve your negotiating power with your current lender. After all, they wouldn’t want to lose a valuable customer like you.

4. Meet your payment deadlines

Being able to pay your credit card bill on time every month can prevent you from raking up the interest that comes with missing a deadline. This is generally a good sign that you are on your way to managing your credit card like a pro, which can be a nod in the right direction from other lenders when it is time to take out another credit card or loans. Setting up automated payments can also help you keep up your good streak.

5. Cut back on the plastic

If you are finding it harder to manage the number of plastics lined up in your wallet then maybe it is time you considered cutting back on some of your credit cards. Checking to see if the credit cards that you currently have match your needs and finances can be the first step to take. There is no limit to the number of credit cards you can own, but keep in mind that having too many could add up to your debt and possibly damage your credit score.

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This guide provides general information and does not consider your individual needs, finances or objectives. We do not make any recommendation or suggestion about which product is best for you based on your specific situation and we do not compare all companies in the market, or all products offered by all companies. It’s always important to consider whether professional financial, legal or taxation advice is appropriate for you before choosing or purchasing a financial product.

The content on our website is produced by experts in the field of finance and reviewed as part of our editorial guidelines. We endeavour to keep all information across our site updated with accurate information.

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