Be Credit Card Savvy

Americans owe a lot of money - more than \$250 billion on credit cards. Perhaps you are one of them. Credit cards represent the ability to obtain cash, goods, or services. If not used properly, credit can be expensive.

Credit card know-how:

1. Only a few cards are needed. Most stores and vendors accept major credit cards other than their own. A Visa or MasterCard will do the trick.

2. Credit cards are useful in tracking expenses. Put expenses that are tax deductible or business related on one card, and personal expenses on another.

3. Pay your credit card bills in full each month before the due date.

4. Beware of advertised low interest rates. These often change after six months. If you aren't satisfied with your bank's rate ask for a lower rate. Many banks are willing to meet competitors' offers.

5. Know what the grace period is on your account. Some are as few as 10 days. The norm is 25 days.

6. Know the rules for cash advances. Often the interest rate is significantly higher than the monthly rate, and charged from the time of the advance, plus a charge for the service.

7. Debit cards deduct your charge amount directly from your checking account. If there is not enough money in your account, the transaction won't go through.

8. Limit the number of cards that you apply for. Don't apply for more than one or two at a time. Each inquiry is included in your credit report. If too many credit grantors inquire at once, they may become suspicious of your intentions.

9. Don't charge disposable items. Make it a personal rule not to charge gasoline or food on your credit card. These items are gone by the time you receive your bill.

10. Keep an updated list of all your cards. Note each account number, and the toll-free phone number to call in case of loss or theft.

11. Know your liability if cards are lost or stolen. If you report the loss before they are used, you have no liability for any charges. If you report the loss after they have been used, you are liable for the first \$50 charged on each card. If the lost card is used for a mail order purchase, and not presented directly to the merchant, you are not liable for any of the purchase. There are registration services that offer to limit your entire liability. This service is not free, but is convenient. Some homeowner insurance policies cover this.

12. Know your rights. Merchants cannot ask for your phone number, address, or driver's license in order to accept your card. They should not ask for your credit card number in order to accept a check. Visa and MasterCard prohibit merchants from requiring a minimum dollar amount purchase in order to use your card.

From Money Sense: What Every Woman Must Know to Be Financially Confident by Judith Briles, copyright (c) 1995. Used with permission of Moody Press, Chicago, Ill., 1-800-678-6928.

Judith Briles (M.B.A., Pepperdine University; Ph.D., Nova University) is a professional speaker, researcher, and author of numerous books. A respected business authority, many of her books focus on women, business, and money: Faith and Savvy Too!, When God Says No, The Confidence Factor, and Woman to Woman. She and her husband, John, live in Denver, Colo.