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How To Use Your Credit Card For Ultimate Financial Advantage
By Alain Diza

Using a credit card wisely is an important step in building a
great credit rating. If you're trying to re-build your credit
or if you're young and just starting out, pay close attention
the next time you receive a new card offer in the mail or
online. When you're trying to build a positive credit history
for yourself, using the right credit card makes sense. Making
small purchases and then making your payments on time each
month is a simple, reliable way to build an outstanding credit
report.

WHAT TO LOOK FOR ON A CREDIT CARD APPLICATION

If you receive a credit card application that appears to offer
a low monthly interest rate, don't make a decision until you
turn it over and closely examine the Disclosure Box. In it
you'll find a more important measure of credit terms - the
Annual Percentage Rate, or APR. By federal law, the Disclosure
Box will also tell you whether or not the card has what is
called a grace period - a number of days, usually 25, until
your purchase starts to accrue finance charges. If a card has a
reasonable grace period and you pay off your balance at the end
of each billing cycle, you won't have to pay finance charges.
It isn't difficult to find credit cards that offer these grace
periods, so if the Disclosure Box doesn't declare one then
throw the application in the trash and look for a better offer.

If you don't have any credit history at all, a credit card
company won't want to give you a very high credit limit, but
that's probably best when you're just starting out. You don't
want to be tempted to go into serious debt with your very first
credit card.

HOW TO CALCULATE YOUR MONTHLY FINANCE CHARGES

Ideally you want to pay off your balance each month to avoid
paying any finance charges, but when that isn't possible it's
important to know the actual cost of the items you purchase.
The annual percentage rate, divided by 12 months, gives you the
periodic rate that will be applied to your outstanding balance
each month. You can estimate what your monthly finance charge
will be by multiplying the periodic rate times the outstanding
balance. It may sound complicated at first, but taking the time
to learn this simple equation can make a big difference in how
you use your credit card.

When you're able to see how much you actually spend on an item
that you don't pay off at the end of the month, it might help
you to resist the temptation to over-use your card. An item
that you want to buy might be on sale at the time you purchase
it, but if you don't pay off your balance at the end of the
month then those finance charges can dramatically increase the
actual amount you'll end up paying.

USE YOUR CREDIT CARD AS THE STRONG FINANCIAL TOOL

Credit cards are only one of the tools available to help you
build a positive credit history. Making on-time payments for
other forms of credit, such as rent and utilities, are also
important. Depending on your situation, within 1-2 years your
credit rating will be improved enough that you no longer need
to use your card for new purchases to maintain your good
credit. Use these tools wisely, and they'll help build your
financial future like no other!

About the Author: Alain Diza makes it easy to acquire a large
selection of premier credit cards designed specifically for
your needs. Access his "insiders-only" selection of credit
cards and financial resources today at:
http://www.onlinecreditcardsdirectory.com

Source: http://www.isnare.com