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Tip of the Week

Using Your Credit Cards Wisely

In addition to deciding a credit card is the right financial tool for you and successfully applying for one, it is also important to understand how to use it wisely. Misuse of a credit card can impact your credit score negatively and could have long-term consequences for employment, housing options, or other loans you apply for. Whether it is your first card or one you've had for a while, this list gives 13 tips to use it wisely and build great credit card habits for life.

What is "Wise" Use?

WiseDollar offers these three tips as advice for How to Use a Credit Card Wisely.

  • Build Credit -- Having no credit does not build credit, but using a credit card and paying the balance timely and in full is a great way to build up your credit score. A better credit score will lead to better rates for other loans you may need in the future.
  • Get Rewards -- Most credit cards have extra perks built in like travel awards, cash back, and other features. By using the card and paying off the balance in full, you can build up the points without building up extra debt.
  • In Case of Emergency -- While an emergency fund is preferable, having a credit card can also help with unexpected expenses, especially if you are traveling and don't have easy access to savings.

What Else Should I Know?

The folks at WiseDollar suggest every family should have at least one credit card in the household for emergencies. Some consultants recommend never using credit cards. But, you can strike a happy medium if you use one in an appopriate manner. You can avoid additional fees, while being prepared for emergencies and expenses you cannot afford up front. This video on Wise Use of Credit Cards and the Dos and Don'ts of Using Credit Cards Wisely are both additional resources to help you learn the best ways to access your credit limit and make timely payments. Following the recommendations will improve your credit score and make you a wiser consumer.

Contact Your Credit Union

If you have a financial relationship with a credit union, they are also a good partner for a credit card. In addition, many also have financial counselors and are happy to assist you with learning to use your card in a prudent manner.





Montana Credit Unions for Community Development (or MCUCD) is the award-winning, charitable arm of the Montana Credit Union Network. A state-wide nonprofit organization, MCUCD works together with the state's credit unions to improve the lives and financial independence of all Montanans.