Are Credit Cards Creeping You Out? Have you heard to stay away from credit cards? Or you’ve heard that you need to carry a balance on the card? What is a secured credit card?
There are a lot of questions about credit cards. Before we dive in, the most important thing to remember is that everyone has a unique relationship with credit. If you have questions, please call us at 912-691-2227 to set up a time to review your credit.
Credit cards are a type of revolving credit. Revolving credit means you can use the credit again after you pay it off. Credit cards are nothing to fear, but you must manage them. The goal with a credit card is the pay the balance off completely each month. This means if you get a bill for $100 and the minimum payment is $25, you should pay the full balance of $100. By doing this you will not owe any interest, but still, be building a positive payment history.
Secured Credit Cards
Sometimes, if you are new to credit you may shop for a secured credit card. What this means is you will give the financial institution you are working with a set amount of money, usually $200-$500. The financial institution will keep that money in an account as the collateral or security behind the credit card. This protects the financial institution from losing money if you do not pay your bill, meaning there is no risk extending the credit card to you. You, as the card owner, will use the card and pay the bill in FULL every month. After a year of positive payment history, they may graduate you to an unsecured credit card. That means you should get your initial money back and your credit limit is not tied to the amount of money you gave the bank.
Are Credit Cards Creeping You Out? Relationships with credit cards can be a helpful way to build and maintain healthy credit. To discuss your specific relationship give us a call at 912-691-2227.