Take Charge of Your Credit Cards

Almost everyone has a credit card. They’re a preferred payment method for many—great for emergencies, accepted just about everywhere so you don’t have to keep a lot of cash on hand and, with some, you can earn rewards on your purchases. But all those benefits can come with a cost. Use these smart tips to help you avoid unnecessary service charges and get the most out of your credit cards.

• “Important News” really is important. Your cardholder agreement and monthly statement may not be exciting to read, but you will learn how service charges are applied, exactly when payments are credited to your account (for example, postings after a certain time are recorded as the next business day), and the cost of convenience services. As credit card policies change, your monthly statement will include an update—generally under the “Important News” heading. Don’t assume that each of your cards operates the same way; become familiar with the details of each card to avoid unnecessary costs.

• The due date is the deadline. The easy solution is to abide by the exact date on the monthly statement. This is the date by which the payment must be processed by the credit card company to be considered on time—otherwise the payment is considered to be late. Send the payment far enough in advance of the due date to be received on time. 

• Convenience costs. Cash advances, foreign transactions, payments over the phone, convenience checks—credit card companies have created a menu of services to make using the card easier, but these services can also come with extra charges. For example, there may be a cost associated with making a payment by phone but not for an online payment. Know the real costs of these conveniences and use them sparingly.

Careful management of your credit cards can prevent extra fees—money you can spend on something else! 

The content of this article is for informational purposes only. AAA does not guarantee any particular outcome.