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How to Introduce your Teen to Responsible Credit Card Management

Introduction

Don’t expect your teenager to automatically understand credit and the ramifications of irresponsible spending and credit card management. Instead, begin teaching him or her about finances as soon as she or he is able to understand, and keep the dialogue going until your teen leaves the house.

While you have your teenager at home you can begin to teach him or her about the importance of responsible credit card use and the benefits of maintain a strong credit score:

• Use online calculators to give them examples. Begin by teaching your teen about credit cards, interest rates and monthly payments. Once your teen has a clear understanding of how credit cards work, use an online debt calculator to show him or her how long it will take them to pay off a debt if they pay only the minimum amount. In addition, show them the ramifications of not paying off a debt in a short period of time and the finance charges they will incur as a result.
• Consider teaching your teen the rules of credit using a prepaid debit card. Prepaid debit cards are a great way to teach your teen about finances, and about the importance of budgeting. You can purchase a prepaid debit Master Card or Visa that will work just like a credit card; however, your teen will need to budget him or herself so that they don’t overspend.
• Once your teen begins working, encourage him or her to open a checking account. Balancing a checking account and understanding the importance of not overspending will become very clear when it comes to managing his or her money. Once your teen has proven his or her trustworthiness with a checking account, you can give your teen permission to get a debit card that is linked to his or her account.
• Once your teen has a firm grasp of credit cards and the responsibility that comes along with them, you may want to consider co-signing for a credit card, particularly if he or she plans on going away to college. A card that is in both your name and your teen’s name will allow your teen to enjoy the benefits of a credit card, but will also allow you to oversee his or her spending.

The Practicality of Online Credit Card Management

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Managing our bills – including our credit cards – has never been easier, thanks to online banking.

Whether through your bank or through your credit card’s website, you can pay your bill and stay on top of your debt without relying on snail mail.

Often times, it just makes more sense to sign up for the credit card management system offered through your credit card, as it will be able to provide you with more information than the bill payment system through your bank.

The Benefits of Online Credit Card Management

In other words, a credit card online management system may allow you to do many things: it may allow you to view your statement; it may allow you to pay your bill online; it may allow you to set up an automatic payment system; it may allow you to request convenience checks; and it may even allow you to ask for a credit increase.

Whatever type of online credit card management system you choose, one thing’s for sure: it sure beats paper statements, checks and stamps any day of the week.

Many people who use credit card management systems may choose to simply eliminate their paper bill each month. Not only can you save paper, but you can greatly increase the practicality and convenience of paying your credit card bill each month.

Features of Online Credit Card Management

You can use your credit card online management system to check recent transactions and to periodically check your account for any signs of theft or fraudulent activity. You may also periodically check your credit card’s balance to prevent you from going over your credit limit.

How to Protect your Identity

Before signing up for an online credit card management system, make sure your computer has the most up-to-date anti-virus and firewall protection, and always make sure that the website security certification is up to date. Finally, always choose a random user name and password, and not a password that is easily identified, such as your address or birth date.

Before accessing your account via your credit card’s website, make sure that you identify the locked padlock symbol near the address bar and that the address of the web page starts with “https”. This signifies that the website you are currently on is encrypted to prevent credit card thieves from gaining access to your personal information.

How to Prepare for Difficult Financial Times

Introduction

Given the state of the economy, it certainly comes as no surprise that many of us have been affected by the recession and the credit crisis in more than one way. And, unfortunately, most of our finances have taken a hit over the last year or so.

With that said, it is important that everyone prepares for difficult financial times so that we can best handle a financial crisis if it comes our way.

1. Start an emergency fund – There is absolutely no better way to make your way through a financial crisis than to fall back on an emergency fund. Most experts recommend aiming to save at least 3 to 6 months worth of living expenses, but every little bit helps. An easy way to start an emergency savings fund is to have a set dollar amount transferred from your paycheck or checking account into an interest-bearing savings or money market account.
2. Keep a good credit card or two and keep the balances low – Now is a good time to find a great credit card or two with competitive terms and conditions and get rid of the rest. It is also a good time to put yourself on a spending budget and to also make it a point to pay the balance in full every month. Getting into the habit of paying off your credit card every month will certainly enable you to manage your budget and your finances better.
3. Reconsider carrying retail credit cards – Retail credit cards are often a mess waiting to happen. They are easy to apply for, easy to receive, and often too tempting to avoid using in excess. If you find yourself charging more than you normally would just because you have a retail credit card then it may be time to say good-bye to your retail credit cards and simply stick with one or two, major credit cards.
4. Keep a home equity line of credit open – Homeowners with significant equity in their homes may be able to secure a home equity line of credit. Many financial experts recommend securing a line of credit in case of a financial emergency. The line of credit is open and ready to use whenever necessary, but you pay no interest or charges if your balance is zero.

The Top Three Points to Better Credit Card Management

Introduction

A credit card comes with a certain set of responsibilities. It is up to you to understand the terms and conditions of your credit card so that you can maintain your card and protect your credit score at the same time.

The bottom line is that many consumers simply fail to carefully read and understand the terms and conditions of their credit cards, which only hurts them (and their credit score) in the end.  Although the new credit card legislation recently signed into law by President Obama will certainly go a long way in protecting consumers, it still comes down to personal responsibility.

And the best way to remain in control of your credit is to simply understand it.

What You Need to Understand about your Credit Card:

• Your APR – You certainly can’t manage your credit card effectively if you don’t know you card’s APR. If you have an introductory rate, you need to pay attention to how long it will last, and certainly what the APR will be once the introductory period has ended. Also, keep an eye on the APRs of other, competitive credit cards to make sure you are always getting the best rate. If not, contact your creditor and ask for a lower interest rate; if they refuse your request, search for another credit card with a better APR so that you’re always ahead of the game.
• Your statement – Your statement should be read carefully, every month – no exceptions! Countless Americans lose money every year because of inaccuracies on their statements that they simply never caught. Keep all credit card receipts and use them to check your statement each month. Also, pay close attention to any other types of fees, as well as past payments, to make sure they appear accurately, as well.
• Your billing cycle – Your billing cycle is crucial to your payments, your interest rate and, most of all, your credit score. Make sure you are aware of your credit card’s billing cycle, as well as the due date for your next payment. Knowing this information will keep you from forgetting to make payments, and it will also ensure that you make your payments on time, each and every month.