Department stores and gas companies have special credit card offers that can help consumers build credit and receive discounts on certain purchases. Often, these cards come with terms and conditions that are very restrictive, but this is for a good reason.
Gas Cards and Department Store Cards
Never possess more than two department store or gas credit cards. These credit cards should be used minimally, and they should be used as a way to build credit. The discounts that come with department store and gas credit cards are just perks. If you own a great number of these credit cards, you’ll have a hard time keeping track of credit purchases and you could end up in debt.
Manage Your Balance In Proportion to Your Credit Limit
It’s smart to keep you balance at an amount that is less than twenty percent of your credit limit. When you carry a high balance, your credit score will be negatively affected. Remember also that it becomes very difficult to pay off high balance debts. So if you’ve got a card with a $500 credit limit, you shouldn’t ever see your balance exceed $100.
Don’t let rewards entice you into charging more than you can afford. Sure, it’s great to get gift certificates or cheap gas, but the problems you will face if you over charge your card will far outweigh the benefits of a few discounts.
Build Good Credit with Special Cards
Make all payments on time, as you’ll be able to avoid late fees and penalty interest rates. Making timely payments is the best way to establish good credit.
You should also avoid finance charges by paying your balance in full. Only make new purchases once you’ve paid your balance.
An Opportunity for Establishing Credit Quickly and Simply
Department store and gas credit cards are wonderful ways to establish good credit, so use them in moderation and you’ll see the benefits of these limited purpose cards.
