The truth is that spending on a credit card is a very easy action that is often done with little forethought. And that could mean a recipe for disaster. If you want to keep your credit card spending under control, here are some tried-and-true words of advice:

• Never spend beyond your means – Many people have heard this, but few people really abide by it. Turn your spending into things you truly want and can afford, not things you want but really cannot afford. As a general rule, if you cannot afford to pay off your purchase in a month or two, you probably shouldn’t purchase it. And the best case scenario is to charge only what you can afford to pay in full the following month.
• Think twice before using a retail credit card – Retail credit cards are so enticing. From their special coupons and deals to their “member only” perks, it is very easy to fall into the trap of a retail credit card. However, this enticing card may also come with a hefty interest rate and even heftier fees. Plus, many studies have shown that people spend much more in a store when they have a store credit card in their back pocket.
• Cut down on your credit cards – The truth is that most people need only two credit cards: one for everyday spending and another one for emergency use. Don’t go overboard and shove numerous credit cards in your wallet; it will only encourage overspending.
• Stop and think before you charge – Often times, simply by stepping back and taking a moment to stop and think about the purchase you are about to make on your credit card, you may spend less. Credit card spending, because it requires no upfront cash, is a habit that can quickly spin out of control if you don’t really take the time to reevaluate the importance of your purchases.

1. We do our banking from a public computer or through a Wi-Fi network. The only way to better protect your personal identity and account information is to bank from the privacy (and safety) of your home. Public networks and public Wi-Fi areas are a hot spot for identity thief activity, as it is much easier for them to gain access to a number of things (through key logging malware), such as account numbers, passwords and other personal information. So, the next time you’re sitting at your favorite coffee shop, leave your online banking and shopping tasks at home.
2. We use unfamiliar ATMs. Using a local ATM for which you are familiar protects you because you are familiar with what the ATM looks like and what the card reader looks like, thereby allowing you to spot anything out of place, such as a card skimmer. Using unfamiliar ATMs does not afford you this luxury, thereby setting you up for identity theft.
3. We pay our credit card bills without looking closely at the statement. There have been many studies that have shown that credit card customers pay for bogus charges all the time, simply because they can’t be bothered with taking the time to examine their credit card statements. In fact, some credit card thieves charge just a few dollars to your card because they know that, chances are, you won’t spot the charge.
4. We toss our receipts. Even if you look closely at your credit card statement each month, do you really remember the exact total of your purchases? Because most consumers don’t hang onto their credit card receipts long enough to compare them to their statement, the door is left wide open for credit card thieves.

Their excuse: they didn’t receive their credit card statement in the mail.

Sorry, but that excuse just won’t cut it in the eyes of your creditor.

Creditors don’t want to hear about lost credit card statements, payments that may have gotten lost in the mail, or nearly any other excuse (real or otherwise) that you may throw their way. You may have some leeway with your creditor the first time this happens, but don’t expect your creditor to be a sympathetic ear to your financial blunders. Take matters into your own hands and make sure the bills get paid.

Because of this, it is important to understand and take care of your monthly debt obligations. Here’s what you can do:

• Make a spreadsheet or other document that clearly marks all debts that require monthly payments, including the mailing address for the creditor, your account number and the due date each month. A spreadsheet will allow you to reference your monthly obligations, thereby ensuring you won’t overlook a payment.
• Set up electronic statements and forgo the paper statement. An electronic statement notification will be delivered, via your email, each month, and your statement will be available online and accessible using a username and password. The email notification may be just what you need to remind you of an upcoming credit card bill.
• Set up automatic payments, if desired. Automatic payments allow you to pay your credit card bill each and every month, at the same time, without a thought from you. If you have trouble remembering to pay your credit card bill (or any other bill, for that matter), automatic payments are definitely the way to go.

The following list of clues will help you identify if it’s time to re-evaluate your finances:

1. You immediately begin to feel stressed when you head to the mailbox – If you get heart palpitations every time you walk toward the mailbox, it may be time to re-evaluate your finances. If you delay opening your mail, or if you fail to even open your credit card statement because you can’t bear to look at the balance, it is definitely time to re-evaluate your finances. Putting your head in the sand, so to speak, accomplishes nothing when it comes to handling your finances; and in many cases, it simply makes matters worse. It’s time to face your financial demons head-on so you can begin heading down a better financial past.
2. You are having difficulty paying more than the minimum payment on your credit cards – Credit cards are a great financial tool if used correctly; if used incorrectly, they can wreak havoc in your life. If you are struggling to pay more than the minimum payment on your credit card, it’s time to either re-evaluate your spending, your budget, or both as to avoid a vicious cycle of hefty finance charges and low, monthly payments.
3. You find yourself using credit cards to handle monthly bills due to a lack of cash – A sure sign of a financial problem starts when you begin paying your monthly bills with your credit card because you have mismanaged your cash flow. Credit card use should be a convenience, not a necessity.
4. Your credit card is near its limit – If your credit card is nearing its credit limit, your spending may be out of control. Pay close attention to your credit card activity over the past six months so you can determine where you went wrong in terms of spending.

If you currently receive your credit card bill each month via a paper statement, you may be wondering if it is a good idea to take your credit card company up on their offer to provide you with electronic statements.

Here is a list of things you should know about going paperless with your credit card statements:

• Your credit card company may offer you a number of discounts and/or benefits for going paperless because eliminating the need to pay for paper and postage will ultimately save them time and money.
• If you want to access older statements, your credit card company may charge you for this. Having paper statements that you can file away and access at a moment’s notice may be more convenient if you need to review or access older statements.
• If you need a clear notification that your bill must be paid, you may be better suited to remain with a paper statement, as many people overlook the email notifications provided by their credit card company. If you receive a large volume of emails every day, or if you tend to forget about due bills, it may be best to stick to the paper variety.
• Electronic credit card statements usually have a feature that allows you to set up automatic payments, thereby eliminating the need to worry about making a monthly payment on time.
• Consider how diligent you would be regarding viewing your monthly statement in an electronic version. If you feel you would be more diligent if you had a bill in your hand each month to review for inaccuracies or fraud, then it may be best to keep receiving paper statements instead of their electronic counterparts.
• If you choose electronic statements, consider you will have to remember your user name and passwords. Forgetting these could mean a considerable inconvenience for you.
• Consider the rewards offered by the credit card company for going paperless. Many credit card companies offer a bump in rewards, or discounts on a variety of services, simply for signing up for electronic statements.

As a result, credit card companies have been looking for ways to recoup their losses, and it looks like they are coming in the form of higher interest rates.

If you find that your credit card interest rate has become too high, you may wonder if there’s anything you can do about it.

In short, if you have a strong credit score to back you up, there is a good chance you can negotiate a lower rate with your credit card company. Here’s how:

• With your credit card statement in front of you, contact the credit card company and ask for a rate reduction. Make sure to point out that you have always consistently paid your bills on time and you have proven yourself to be a loyal customer. If you feel as if you’re getting nowhere with the customer service representative, ask to speak to a supervisor and plead your case to him or her.
• Often times, threatening to close your account is enough to get your rate lowered, so try this tactic if you are prepared to do just that if they won’t play ball with you regarding your credit card interest rate.
• Many credit card companies are, once again, opening up credit to good customers, so consider checking out all of the credit card balance transfer offers you are likely receiving in the mail and transfer all of your higher-rate balances onto a new, lower-rate card. The good news is that, in addition to creditors extending credit once again, they are also luring good credit card consumers in with great balance transfer deals, so consider the terms and conditions of a creditor’s balance transfer offer when deciding which card is right for you.

However, it is important to realize that, even though the government has changed some of the ways in which credit card companies operate, it does not dismiss your role in becoming — and remaining — an educated and aware credit card consumer. In other words, it does not negate your responsibility when it comes to handling your own finances.

Here’s what you need to be doing:

• Carefully checking your credit card statement each month – Instead of ripping open your credit card bill and paying the amount in the “due” box, take the time to read each transaction and compare it with your receipts. It is possible that errors and discrepancies exist on your credit card – errors and discrepancies that you may be paying for if you don’t take the time to review your statement.
• Reading all literature sent by your credit card company – Because the new legislation requires credit card companies to be more forthcoming when it comes to changes in your credit card’s terms and conditions, you may begin receiving letters and notices from your credit card company. Although it may be a bit annoying to take the time to read this information, it is important because it may include important changes to your credit card that you can choose to accept or reject. If you don’t respond to the correspondence, you may be forfeiting your right to reject the changes to your card.
• Taking advantage of the new statement features – The new legislation requires that credit card companies show consumers the result of paying just the minimum payment on their credit cards. Because of this, you should find a chart on your statement detailing the interest you will pay, and the amount of time it will take, to pay off your credit card paying just the minimum balance. Often times, it is this information that serves as a prompt to begin paying more on our credit cards each month.

It’s quite amazing, actually: we seem to have been transformed from a country that first relied on cash only, to a country that lived on credit, and back to a country that may not have reverted back to that cash-only mentality, but instead has now achieved a good respect for credit and finances, in general.

With everything else we must teach as parents, it may seem like an afterthought to educate our children on the importance of finances but, in reality, this is a very important topic that should be openly discussed throughout every stage of your child’s life. Aside from teaching the obvious concept of checks and balances, there are a few important things to teach your children about credit cards:

• Show them the process of purchasing on credit cards – The next time you make a credit card purchase, explain the process to them. Use this opportunity to explain the benefits of credit cards and the responsibilities that come along with them. It may be more difficult for your children to understand the process when they don’t see money being exchanged, so it is quite important to let them know that, although you are not paying upfront with cash, you are responsible for paying back the bill when it arrives.
• Show them the credit card statement – Which brings me to the next task on your list of things to show your children. After you have explained the process of purchasing items with credit cards, show them the bill when it arrives and remind them of the purchase that you made together and how the charge appears on the credit card.
• Explain the concept of interest and fees – Show your children the process of paying your credit card bill and the ramifications of not being able to pay the bill in full when it arrives. Do the math with your child and show them that those $20 pair of sneakers may end up costing much, much more if you fail to pay the balance off when the bill arrives.

Many consumers overspend on credit cards because, well, it’s easy to do. Armed with just a card, you can step into a store and purchase things you normally would not purchase if you had to give up the cash in your pocket to do so. Credit card spending often makes us more careless and irresponsible when it comes to shopping, and therefore puts many of us in a precarious situation of too much debt and not enough income.

You can control your spending, though, even if you are currently spending more than you are making each month. However, in order to regain control, you must be able to identify- and rectify – the source of the problem.

Here’s what you need to do before you make another credit card purchase:

• Contact your creditors and ask for a copy of your credit card statements from the last six months. Once you have the statements in front of you, take the time to really examine them. What are your weaknesses? Do you spend more at a certain retailer? Can you pinpoint what you seem to be spending the most on each month?
• Stop spending until you have recognized the problem. Unless you fully understand why you are spending and what you are spending on, you cannot begin to fix the problem and gain control of your finances. Make a pact with yourself to cease spending on anything but the necessities until you have pinpointed the problem.
• If you feel like you may have a spending problem, get help immediately. Contact a non-profit credit counseling service and seek help for your spending problems. Remember: ignoring the problem won’t make it go away.
• Eliminate the source of the problem. If you overspend each time you shop at a certain retailer, promise yourself that you will not take a credit card with you the next time you visit that particular retailer. Then, reflect on your purchases at that retailer once you no longer use a credit card. Are your purchases different? Are they any less? Are you more inclined to think twice before making a purchase?

In addition to enjoying easier-to-read credit card statements, the credit card legislation may mean other positive changes for consumers like you.

Clearer Communication between Creditors and Consumers

Creditors must be more communicative when it comes to your credit card account. Any changes in your account must be addressed in writing, and you must be given ample time to either accept or reject these changes. For example, if your creditor raises your interest rate, you must be informed, in writing, at least 45 days in advance of the increase in interest. In addition, if you choose to reject the interest rate increase, you can cancel the card and pay off your remaining balance with your current interest rate.

Budgeting Made Easy

Another change the credit card legislation has brought about shows up on your credit card bill. Creditors are now required to show, in clear language, the amount of time it will take to pay off your credit card if you pay only the minimum payment and the amount of time it will take to pay off your credit card if you send in more money. This change will provide an easy-to-understand explanation of the effects of just paying the minimum balance on a card.

Other perks of the new credit card legislation include:

• Any payment you send in goes toward the balance with the highest interest rate. This is particularly helpful if you have purchases from different promotional periods.
• Creditors cannot raise your interest rate during the first year of having an account (unless you default on the credit card’s terms and conditions).
• Double cycle billing will be eliminated, preventing creditors from calculating finance charges from the previous, as well as current, billing cycles.
• Creditors are under strict rules regarding granting credit cards to consumers under the age of 21, thereby protecting many college-age students from obtaining credit and possibly destroying their credit score at a young age.