How to Use Credit Cards Responsibly

Credit cards can help build your credit profile, which could be helpful for getting mortgages or car loans. However, they can also come with hefty fees if you don’t use them responsibly.

Choosing the right card for your spending habits starts with identifying how you spend most of your money. Next, consider a card that offers rewards in your spending category.


Credit cards are a great way to build credit and earn rewards. They provide a line of credit up to a pre-set limit, and the card issuer sends a monthly statement with a list of purchases. The card issuer will then deduct the amount spent from the available balance. Most credit cards offer a variety of benefits such as points, cash back and travel perks. They may also include insurance coverage such as rental car collision and theft protection. Some cards also offer price protection, which reimburses the card holder for any items that drop in price within a certain time frame.

If you’re a responsible user of credit, these benefits can add up to significant value. But be sure to keep track of your spending and pay your monthly bill in full by the due date.


Credit cards can help you build your credit, pay for emergencies and meet other expenses that you might not have the cash for. However, you must be careful with them. They can lead to debt, fees and a bad credit score. To avoid that, you should understand how they work and their common terms.

A credit card is a plastic card that you can use to make purchases at most establishments and online. It has a card number, expiration date and security code. You can swipe, insert or tap it into a payment terminal to make a purchase. After a few days, the transaction will post to your account balance and increase your total credit limit. You will then receive a monthly statement that lists your purchases and a minimum amount due by the end of the billing cycle.


Credit card rewards can be a great perk, but how much value they actually provide depends on your spending habits and the type of card you choose. For example, a travel rewards card may offer you bonus points or an annual statement credit for global entry and TSA PreCheck application fees.

Other cards feature shopping discounts, which can add up to significant savings over the long term. Some cards also have earning limits in certain categories or time frames. These limits can reduce the amount of reward dollars or miles you’ll earn over time, and they may limit the overall value of your rewards.

Many cards offer different ways to redeem rewards, including statement credits, checks, merchandise and charity donations. Some cards also have rewards expiration dates, which can decrease their value.


Credit cards can come with a lot of fees, especially if you carry a balance or make late payments. These costs can outweigh any rewards and benefits that the card offers.

Interchange fees are charged to the credit card issuer for each transaction that is made on the card. These fees are often a percentage of the transaction amount and can vary by card network.

Many credit cards charge a foreign transaction fee of around 3% on purchases made outside the United States. Some cards also charge a transfer fee of between 3% and 5% on balances moved from one card to another.

Other fees can include a late fee for missing your monthly payment, which is typically $30, or an annual fee. The yearly cost of some credit cards can add up quickly, so look for cards that have no annual fee or waive the fee for the first year.

Getting a credit card

Credit cards are a useful financial tool, but only if they are used responsibly. A credit card can be a great way to build credit, finance purchases, and earn rewards. It can also be a good way to avoid interest charges by paying off the balance every month.

If you are thinking of getting a credit card, it is important to know what fees and rates are involved. You should also understand the card’s terms and conditions, such as its credit limit, its billing due date, and the minimum payment amount. You should also choose a card that works well with your lifestyle and spending habits. For example, if you frequently dine out, consider a card that offers restaurant-specific rewards. It’s also helpful to review your monthly statement, which shows each purchase you made.