By Zulika van Heerden ©2007

Credit cards can be beneficial for individuals who understand and practice the basics of responsible use of credit. However, people who don't use this kind credit wisely can find themselves deeply in debt very quickly. Everyone who uses credit needs to understand how to use it in an intelligent manner.

Don't Accept Every Offer That You Get

If you have good credit, you probably receive a number of offers in the mail every week encouraging you to incur more debt. The fact that a lender is offering you an opportunity to get another credit card does not mean that you actually need one. If you have too many credit cards, you may find yourself running up balances on multiple cards, which can be very dangerous to your financial well being.

Most people should not have more than two credit cards. Many people get one card for day-to-day purchases, and have a second card that they use strictly for emergencies. Individuals who own companies or who make up-front payments for job-related travel sometimes need a third card so they can easily keep track of which purchases are business and which are personal.

Don't Purchase Things You Can't Afford

If you are spending more money than you earn each month with the help of your credit cards, you are on your way to financial problems. It's okay to use credit for convenience, but you need to be certain that you can pay your balance in full each month, or within a reasonable period of time. If you are buying luxury items that you can't pay off within a few months, you are not using your credit wisely.

Always pay more than the minimum payment on your credit accounts. If not, you'll find that the quickly accruing interest on revolving credit accounts adds up very quickly, often putting you in serious financial jeopardy. Individuals who pay only the minimum payment each month quickly finds themselves much further in debt than they expected.

Be Diligent in Checking Your Credit Report

Part of being a responsible credit card user is checking your credit report at least once each year. There is, unfortunately, a very real risk of identity theft. If someone is using your identity to open credit accounts, you'll find out when you look at your credit report. Many times people discover that incorrect information on their credit reports is pulling down their credit scores. Such problems can be appealed and corrected when you become aware of them.

Another reason that checking your credit report frequently is so important is that you are able to see how your current debt and payment habits are impacting your credit history. This can be a real eye-opener regarding the
importance of paying all bills in a timely manner.

Recognize the Need for Help

Another aspect of responsibility is the maturity to recognize when help is needed. If your spending is out of control, ignoring the problem won't make it go away. Seek assistance from a trustworthy credit counsellor who can help you come up with workable solutions to your credit problems. If you're having credit troubles, the sooner you seek help, the faster you can be on the road to rebuilding your credit.

For more on debt consolidation see below (these articles should be links back to other articles on the site.)

-Credit Card Debt Secrets
-Steps to Eliminte Credit Card Debt
-Debt Free Living
-Lowering Your Debt For Life
-Are your debts keeping you awake at night?

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Just apply and compare the repayments to your current situation. There is no obligation on your part. If you decide that it is not for you, you simply do not have to accept the offer. You have nothing to lose and everything to gain.

20 Second Application