Getting A Good Debt For Available Credit Ratio Essay

851 Words Aug 28th, 2015 4 Pages
Having a good debt-to-available credit ratio will help you attain a good credit rating. The less debt you have compared to available credit, the better your credit rating. To learn more about how important credit cards are to the overall credit rating process, visit myFICO.
Since having good credit is important, knowing how to minimize the charges you pay to credit card companies is also important. Monthly finance charges, fees, and penalties can become quite costly over time. However, there are a few ways to save on your credit card bill.
Use credit cards only if you have the money to pay off the balance. If you stick to using credit only for things you can already afford, you will not run the risk of carrying balances from month to month. Although this is much easier said than done, consider the high interest rates charged by many credit cards, especially department store credit cards. By relying only on necessary purchases and not carrying balances, you will avoid monthly finance charges.
Understand how monthly finance charges are calculated. Monthly finance charges are the monetary amounts that credit card issuers charge for using their money each month. These charges are based on the annual percentage rate set by the credit card company; however, the monthly charges can fluctuate based on several factors:
Due date: The date the bill must reach the company. If the company does not receive payment by this date, they may charge a late fee.
Actual date the payment reaches…

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