Debt management issues can be solved with choosing the right credit card.


Debt management troubles can be eased by something as simple as, choosing the right credit card.

Considered a blessing to those who use it properly,  credit cards can make life easier to manager.  Consequently, if you are having  trouble managing debt,  it can be an excruciating curse that will only give you a bad credit history.

Choosing the right credit card is the best place to start.  The more you know about them, the better you can manage them.

Here are some important tips when choosing the right credit card:

  • You need to consider interest rates which come as “fixed-rate” or “adjustable rate”.  If you choose a low APR credit card, you may also consider choosing a fixed rate credit card.  Many people—especially those who pay off their balance monthly or those who only use cards for small purchases-opt to use cards that have fixed rates. That is because, if the rate is a point or two higher than the usual, it ensures that they can pay off their loan quickly without even noticing the difference.
  • Choose a credit card that gives points or rewards for purchases,as you will get back free merchandise just for using the card.
  • If you need to build credit before you can secure a credit card, get a prepaid credit card.  This will help build your credit and you can only spend your own money.
  • Do your own research on credit card fees, transaction fees, and other charges. Numerous companies are infamous for charging their clients fees that add up quickly, one should make sure to check the fees section of the credit card disclosure section before fully indulging into it.  Most people do not read the fine print, you should.  Credit card companies must disclose all fees and it is likely you will see the hidden fees that you may be charged.  Some of these hidden fees are annual fees and cash advance fees.
  • What is the “grace period.” The term “grace period” or “interest-free time” refers to the amount of time between the date of a purchase and the date interest starts being charged on that purchase.  The majority of credit cards companies offer a standard grace period, which means that as long as the person pays for his/her bill monthly, there will be no finance charges. However, many credit card companies are notorious for establishing a month period as 28 days rather than 30.  You need to be aware of this date difference.  Two days makes a huge difference in interest charged.   Since not all credit card companies offer a grace period, be careful not to choose that type of credit card as they may charge interest immediately on every purchase you make.

Credit cards offer you convenience of payment, but there are other additional benefit for owning a credit card, including; product insurance, credit card protection, discounts, rebates and special merchandise.

Personal benefits include rewards programs that let you earn points that can give you cash refunds, free gas, gift certificates and free plane tickets.  This is something you should consider when choosing the right card; do you travel more, drive  a lot or simply like free gifts?  You will want to apply for a rewards program that will offer you the most benefit.

Be careful to always take note of your credit limit. Credit limit is defined in dollars as the total amount of credit a credit card holder is authorized to use.  Often a credit card company will raise this limit without consulting you beforehand.  This is not always a welcome perk if you have a hard time managing debt, as it may get you in over your head.

Make sure you understand all the necessary and additional terms.  While it is very important for you to have a credit card, because you cannot travel or shop on line in some places, you need to be responsible in paying it in a timely fashion.

Our best advice to you is, if you cannot afford something, then you simply should not buy it.  Credit does not mean you have extra money, it just means  you can use money until you can pay it back.  If you think that way about credit, you will never have a problem with it.

If you constantly think that the more credit you have, the more money you have, then you will eventually fail, but the good news is you can fix it before it becomes a problem by changing you attitude about credit cards.

At SG Partners we are committed to showing you how to get back on the right financial track.