Q: I’d love to improve my credit score, but I can’t get ahead of my payments. I also find that my spending gets out of control when I’m paying with plastic. How do I use my credit cards responsibly?
A: Using your credit cards responsibly is a great way to boost your credit score and your financial wellness.
Here’s all you need to know about responsible credit card usage.
A credit card is a revolving line of credit allowing the cardholder to make charges at any time, up to a specific limit. Each time the cardholder swipes their card, the credit card issuer is lending money for the purchase. Unlike a loan, though, the credit card account has no fixed term. Instead, the cardholder must make payments toward the balance each month until the balance is paid off in full.
Credit cards tend to have high-interest rates relative to other kinds of loans. The most recent data shows the average industry rate on new credit cards is 13.15% APR (annual percentage rate) and the average credit union rate on new credit cards is 11.54% APR.
Paying bills in full and on time has multiple benefits:
There are several important terms to be familiar with for staying on top of credit card billing.
A credit card billing cycle is the time between credit card billings. It can vary from 20 to 45 days, depending on the credit card issuer. Within that time frame, purchases, credits, and any fees or finance charges will be added to and/or subtracted from the cardholder’s account.
When the billing cycle ends, the cardholder will be billed for the remaining balance, which will be reflected in their credit card statement.
Credit card bills will also show a payment due date, which tends to be approximately 20 days after the end of a billing cycle. The time frame from when the billing cycle ends and its payment due date is known as the grace period. When the grace period is over, and the payment due date passes, the payment is overdue and will be subject to penalties and interest charges.
4100 Dressler Rd. NW
Canton, OH 44718
Loan Dept.: 330.493.7602
Loan Dept. Fax: 330.493.1619
Cleveland Ave. Branch
3426 Cleveland Ave. NW
Canton, OH 44709
1281 S. Sawburg Ave.
Alliance, OH 44601
Minerva Area Federal CU Shared Branch
(Cash and deposits only)
3570 Union Ave. SE
Minerva, OH 44657