1. Don’t carry a credit card balance!
Weird advice, I realize, considering the whole idea of credit is the joy of spending money you don’t have. That said, paying 18% interest to a credit card company is pretty similar to throwing your cash out the window. I recommend getting a credit card because they are convenient and it’s important to build your credit – but only if you can pay off the minimum balance each month.
2. Pick a good credit card
…Preferably one that will give you rewards you will actually use (like cash back, but check the percentage, 1% cash back is not going to fund your trip to Tahiti) and has an easy online interface. I’m a big fan of Capital One credit cards because they’re very customizable, customer service is good, and their website is easy to navigate.
3. Get your FREE yearly credit report. Every year.
A better use of the time you spend facebook stalking ex-boyfriends and girlfriends, go to: www.AnnualCreditReport.com.
There are 3 companies that track your credit. Check all once per year or 1 every 4 months. Make sure to fix any mistakes before they can negatively affect your credit score (making it harder to borrow money for a home or other investment).
4. Ask for a lower rate!
Call your credit card company once every 6 months and ask for a lower rate. They’ll usually say yes, and while it’s best not to carry a balance, if you’re going to have a balance might as well have a low rate.