3 hacks for using your first credit card to level up your finances
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3 hacks for using your first credit card to level up your finances
"Although it might be confusing to understand at first, credit is the backbone of your financial life, Alev said. Credit cards are tools (specifically knives, Dunlap said) that can be used to boost or weaken your score. Many people share Dunlap's No. 1 rule for credit card payments: Make them on time, and pay in full if you can. However, monthly bills are the tip of the iceberg when it comes to building credit."
"Alev recommends putting small recurring payments on your new credit card. Instead of maxing out your $500 starter limit on one item, charge your Netflix or Spotify bill to your credit card. "Twelve months go by. You've spent, maybe, $100 on that card," Alev said, referring to the rough cost of a year's worth of a streaming subscription. "It's paid off in full. You have that year of card history.""
Credit is the backbone of financial life and credit cards can either boost or weaken a credit score. Making payments on time and paying in full when possible prevents interest charges and protects scores. Start new cards with small recurring charges like streaming subscriptions to build a year of on-time history without maxing limits. Reduce balances more frequently, such as paying weekly instead of monthly, to lower credit utilization. Building credit history helps qualify for loans, better cards, lower interest rates, and influences renting, insurance, and some job applications. Small consistent actions create lasting credit benefits.
Read at Business Insider
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