How to Successfully Juggle Multiple Credit Cards
Benefits of Owning Credit CardsHaving one or more cards can have benefits for consumers. For one, they are certainly a convenience when a consumer needs purchasing power. They are also vital to maintaining good credit scores when the card balances are taken care of on a consistent basis. Additionally, many credit cards offer incentive programs that save account holders cash with every purchase. Finally, there are many situations that require credit cards in order to be privy to some services such as car rentals and online purchases. Credit the staple of a person's financial life these days.
How to Manage Multiple Accounts
Juggling several credit card accounts is not impossible and it must be done effectively to have financial benefits for the card holder. Here are some basic essentials of successful card management of multiple accounts:
Assign Cards
Consumers typically have reliable habits when it comes to shopping. You can benefit most from cards when you allocate a purpose to each card. For instance, the credit card that gives you cash back on all purchases should be used for groceries or gasoline since you likely purchase those products and services most often, giving you the most cash back. Other cards can be dedicated to online purchases, bill payments, or as an emergency backup.
Set Up Payments Automatically
To avoid confusing due dates on multiple cards, it is important to establish on-time and regular payments for each of your creditors. The best way to assure this occurs consistently is to set up automatic payments through your bank so that your credit cards are never paid late or missed. If you do default in any way, you will face serious consequences in higher interest rates and multiple penalties when more than one card payment is missed. Additionally, your credit rating can significantly suffer.
Track Your Spending
Just because you have $4000 in credit spread across multiple card accounts does not mean you have the budget to spend that much. Ideally you never want to spend on credit what you don't have in cash to back up. It is best to make small purchases on all of your credit cards during the month and pay off the balance in full. This method of utilizing your credit cards will do wonders for helping you maintain ideal credit ratings and high scores.
Never Go Overboard
While having multiple cards can be beneficial to your financial life, it can also be disastrous if used for the wrong reasons. If you continually sign up for new cards, you can do serious damage to your credit reputation. Also, if you sign up for just any card being offered, you can also lower your credit rating. Be very selective in the credit cards you choose and only apply for the cards that make sense for your lifestyle and your financial needs.
Cards can reboot a stale credit history or they can financially ruin you for many years to come. They are a consumer service that should never be taken lightly or used recklessly. If you are in need of your first credit card or want to take advantages of new financial benefits, consider your card selection very careful and never overextend yourself on credit.
