Without the right knowledge, owning a credit card can be daunting. Over the years there have been a number of myths that have had a negative effect on the idea of signing up for a credit card. For a number of years many people have thought negatively about having access to a credit card. The reality is that there are number of credit card myths out there.
Credit card myths dispelled:
Carrying a credit card will lead to damaging credit card debt
The truth is that when handled responsibly, having a credit card offers an easy way to establish and build credit history. Having a credit card which you repay on time every month can help you improve your credit score.
Carrying a balance helps your credit score
This is a myth that has contributed towards damaging numerous credit scores. This is why you need to ensure that each month you repay your credit card bill on time and in full. Never miss paying at least the minimum.
You should only have one credit card
If you are organised and responsible you can take advantage of cash back rewards offered by multiple credit cards. It’s important to find a credit card that matches your particular spending habits. It also helps to have at least one credit card with a low interest rate. Always keep in mind that your goal should be to keep your credit utilisation low.
Having a credit card will hurt your credit score
This is one of the many credit card myths that have prevented many people from applying for a credit card. The truth is that if you behave responsibly and avoid maxing out your credit you can actually improve your credit score. It’s important to make sure that keep track of your repayments and that you pay on time.