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Credit Cards
Take Charge When You Charge
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#15 Choose Wisely
The best way to maximize the benefits of credit cards is to understand your financial lifestyle — your money needs and wants. Once you determine how
you'll use a credit card, it's important to understand all of the card's features including:
Annual Percentage Rates (APRs) and whether rates are fixed or variable
Annual, late and over-limit fees
Credit limit on account
Interest free periods before interest begins accruing
Rewards including airline miles or cash back
You can find more about choosing credit cards and managing credit at
www.chaseclearandsimple.com/aarp.
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#16 Stay Alert
Some credit card issuers offer free, personalized and automatic alert messages to your phone and email to help you keep track of:
Available credit
Balances
Payment due dates
Payment histories
Purchase activity
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#17 Compute the Cost
Understand the true cost of your credit purchase. Figure out the total price when you pay with credit based on interest you may pay. Make the
largest payments possible on your bill. And know the penalties for missed payments.
Visit www.chaseclearandsimple.com/aarp to find resources and interactive tools
for managing credit.
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#18 Follow the 20-10 Rule
This general "rule of thumb" helps you understand how much credit you can afford. Credit cards are loans, so avoid borrowing more than
20 percent of your annual net income on all of your loans (not including your mortgage). And payments on those loans shouldn't exceed 10 percent of
your monthly net income.
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#19 Understand Your Rights
Credit cardholders are entitled to protections:
Zero liability means you are not responsible for fraudulent charges when you report them promptly.
In some cases, you have the right to dispute purchases with merchants for unsatisfactory products or services.
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#20 Know the Score
We all change over time, and so do our credit scores. These scores are the numerical value used by lenders to assess individuals'
"credit risk" at a given time. It changes based on history of payments, amounts owed, new credit and more. Credit scores range in
number from 300 to 850. The higher your score, the better.
Click
here to view credit scores range.
Credit scores are important because they influence whether you'll be approved for credit cards, mortgages and other loans, as well as the
interest rates you're offered. Some of the best ways to keep your scores high are to:
Pay all of your bills on time.
Make more than the minimum payment.
Don't open needless revolving credit accounts.
Fill out credit applications only when necessary.
Avoid keeping credit cards at or near the maximum spending limit.
Click
here to view credit agencies.
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#21 Make No Mistakes
Over 13 million people a year find inaccuracies on their credit reports — incorrect late payments, accounts that should have been closed,
other people's debt information and more. Report mistakes right away; errors could lower your credit score, costing you money.
You're the one who has to ensure your report is correct. If you find an issue:
Check the last page of your report — instructions for claim disputes are usually on the last page.
Contact the credit bureau and report the error immediately.
Put it in writing — if the issue remains unresolved, provide a letter of explanation and request that it become part of your report.
View a sample credit report to see what to look for.
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