4 Ways Credit Cards Help a Credit Score
It’s important to have good credit. From vehicles and homes to every day purchases, good credit gets you credit-approved with better rates and better terms. This is true for credit cards too. So how can you make credit cards work in your favor?
Using credit cards to make every day purchases encourages regular transactions and keeps your credit line open and healthy.
(Just remember to add your credit card statement to your monthly budget!)
Go through your budget calendar and review regular weekly or monthly purchases. Find and expense or recurring bill that you're comfortable starting to pay on your low-rate credit card, and make sure you've included your card payment on the same financial calendar.
Ready to transfer those high-interest rate credit cards? Check out our Visa Balance Transfer offer.
Paying Towards Your Credit Card Balance Every Month Increases Your Credit Score
Making a regular monthly charge on your card and paying it off shows great discipline to your credit holders. On-time payments will improve your overall credit score and can result in an increased limit, in case you need to make bigger purchases in the future. If your wallet is tight one month, it’s okay to just pay the minimum balance!
Review your budget or build a new one with our free Budgeting Tool.
Keeping your oldest credit cards open gives you established credit for bigger purchases.
A big myth circulating financial responsibility is that closing older credit cards that are paid off is a good thing for your credit score. Keeping your oldest line of credit open and active shows loan grantors that you have an established payment history. The longer they can look back to see your on-time payments, the better.
Learn more about Credit Management: Credit Scores and Reports.
Choosing a credit card that gives rewards can put even more back in your pocket or provide points for great experiences and/or product!
There’s nothing better than being rewarded for having good financial habits. Selecting a credit card with low-interest and redeemable points will encourage responsible spending and will usually offer additional rewards at different times of the year for making specific purchases.
Not sure if you’re ready to have established credit or need assistance with rebuilding your credit?
Making big financial decisions don’t have to be overwhelming. Your credit union is ready to take those steps with you—contact your local branch manager today.
*Statistics found for American cardholder ownership found on creditcards.com