Don’t fear the credit card

Credit cards get a bad rap. It may be because Americans have fallen prey to the allure of the immediate satisfaction they bring. In fact, among U.S. households that have credit cards, the average amount of credit card debt is a staggering $15,624. But if you track your spending and keep yourself in line, credit cards can help you build credit and provide you with incredible rewards and benefits. It will require some homework, discipline, and intention, plus the creation of some solid habits.

So before you close your accounts and take scissors to your credit card, consider using them to meet your monthly budgeting goals – and rack up rewards points in the process. One way is to use a credit card consistently for “everyday spending” such as groceries, gas, and other routine expenses. The key here is to pay the balance each month and avoid interest payments.

Consider using credit cards to meet your monthly budgeting goals – and rack up rewards points in the process.

Need help getting started on your credit card hunt? NerdWallet, an independent, online financial advisor, has done the research for you and come up with the best credit cards of 2018.

If you’ve accumulated sizable credit card bills, it’s important to get that debt paid off as quickly as possible to prevent the interest from compounding. Here’s one way to do it: Pay off your smallest credit card debt first. Once it’s paid off, take the money you were paying on that debt and add it to the minimum payment on the card with the next highest balance. This results in a “snowball” effect of debt reduction.

FOR MORE INSIGHT

On finding the right credit card
Credit cards 101 (NerdWallet)
6 reasons you shouldn’t fear credit cards (Investopedia)
5 rules to follow when you apply for credit cards (NerdWallet)
Best credit cards of 2018 (NerdWallet)

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