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7 Healthy Habits for Using Credit

healthy habits for using credit

Nearly half of Americans carry some amount of credit card debt each month, according to a new survey from And that debt is on the rise -- totaling $420 billion in late 2018, an increase of 5 percent over 2017.

Credit card debt can be costly -- and stressful -- for consumers. But that doesn’t mean credit cards are all bad. When you adopt healthy habits for using credit cards, they can be a lifesaver for the days when the furnace breaks down during a cold snap or the brakes fail on the car you need to get to work.

7 healthy habits for using credit cards

1.Pay in full and on time

We really can’t say it enough. When you pay off your credit card bills each month and on time, you’ll avoid costly interest charges and late fees.

Credit card interest charges really can quickly add up. In fact, households with regular credit card debt paid an average of $1,140 in interest in 2018, according to the recent NerdWallet report. When you pay your bill late, you also face a late fee of between $25 and $35 and, in some cases, increased interest rates.

If you can’t pay off your entire bill, it’s still best if you can come up with more than the minimum required payment. You’ll accrue less interest and more quickly wipe out your debt.

2. Stick to a budget

It’s easy to pay off your credit card bills each month if you simply stick to your budget. If you know how much you can afford to spend on groceries, meals out, clothing and required expenses, you’ll always be able to write a check for the full amount.

If you use your card for daily expenses, it’s especially important to check in to your account at least once a week to ensure that you’re staying on track. It’s easy for that “weekly” splurge at the coffee shop to turn into a daily one.

3. Keep your credit score in mind

Your credit score gives lenders a glimpse of your financial health as they determine whether to loan you money through purchases like a mortgage or a car loan. And how you use your credit cards gives them a big window into your financial habits.

To keep your credit score high, know that paying off your debt is rewarded with a higher score and opening multiple cards is discouraged. As the credit scoring system sees it, the more available credit you have, the less likely you’ll be able to pay off all your debt if you reach your credit limit.

4. Get text or email reminders about payments

One of the healthy habits for using credit is making sure you pay on time, every time. Most credit card companies are more than happy to alert you to payment due dates. Sign up for their text or email notifications so you’re never late.

5. Look for rewards

Some credit cards give you points toward airline miles or hotel rooms. Others give you cash back on eligible purchases. Some will provide identity theft protection or car rental insurance or replace things you’ve purchased with the card, such as that camera you dropped soon after you bought it.

Determine what perks your credit card offers and use them. If your credit card doesn’t include benefits that appeal to you, there are plenty of options out there to choose from.

6. Keep an eye on your statements

Each time you get your monthly statement, scan it for any unusual charges to ensure you’re not the victim of fraud or a billing error. Spotting potential errors or fraudulent activity right away can help you address it quickly with minimal impact.

7. Know how to get back on track

Even those who have healthy habits for using credit cards have unexpected expenses from time to time. Sometimes the furnace does break down in the middle of the winter and, suddenly, you have a $3,000 charge on your credit card that you can’t afford to pay off in a single month. That’s OK. Instead of stressing over it, make changes now to ensure you can pay it off as quickly as possible by cutting your other expenses.

Then, once the bill is paid off, start working on an emergency fund, so you can better afford the costs of the next unexpected event and don’t rack up more credit card debt.

The CESI Team is committed to helping you reach your financial goals. If debt keeps you from living the life you dream of, contact us for a free debt analysis today and get started on the road to a brighter future!


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