Welcome back for Part 2.Â Letâ€™s get right into it.
Credit cards come with all sorts of perks, as we discussed in Part 1.Â There are many cards that donâ€™t have the perks that we all hear about on TV but are still very valuable so itâ€™s best to read the fine print before you sign up.Â For example, some cards have roadside assistance plans should you break down somewhere.Â This would be very convenient for you if youâ€™re on the roadÂ often or if you have an older vehicle.
Other valuable perks include purchase protection as well as extended warranties, something that fewer cards carry these days. Thereâ€™s also travel assistance should you find yourself in trouble when on a trip. This can cover a multitude of things such as legal aid, baggage fees, car rental accident coverage and trip cancellations. Again before you sign up make sure that youâ€™re getting the card you want with the perks you desire.
If you have a bad credit record or no credit history you may need to apply for a secured credit card or become an authorized user on someone elseâ€™s account.Â Secured credit cards require a deposit in order to be approved, usually somewhere between $3 to $500.00.Â If you pay them off on time and have no problems for a year (sometimes longer) youâ€™ll find that many credit card companies are willing to start giving you regular credit.Â Piggybacking on a parent or spouseâ€™s credit card can be tricky but for some itâ€™s the only way to get a credit card. Just be careful and make darn sure you pay on time every month.
Speaking of paying on time if you want to improve your credit score and/or keep it higher youâ€™re going to want to not just pay the minimum each month but as much more as you can to pay down your cardâ€™s debt and pay less in interest.Â Only purchase what you can afford to pay off quickly, pay on time always and make sure that your utilization rate, the amount of credit you have against how much youâ€™re using,Â stays as low as possible.
If youâ€™re denied there are new federal laws that make reporting the reason why a requirement for credit card companies.Â Within a few days you will receive a report saying the exact reason why and the exact info related to their decision to deny you.Â This can help you to figure out what you need to do to increase your score and take care of the problems that caused your denial.
Great stuff, yes?Â Join us soon for Part 3.