Avoid this scenario by taking advantage of all the technology that surrounds you. Set your smartphone with a recurring alarm, make an event on your computer calendar or consider setting up an automatic payment. Technology is fun, but it's not necessary: a paper statement, a highlighter and a fridge magnet work nicely, too.
5. Giving your card to your kid Perhaps nothing says, "I trust you," like giving a teenager access to thousands of dollars with a credit card, but surely there are better ways to create this bond and foster responsibility in your adolescent. Not only are you responsible for the balance they run up, but your credit score could also take a plunge if the balance is enough to increase your credit utilization percentage.
According to the Council for Economic Education, in 2011, only 13 states required students to take a course in personal finance. So make sure you take the lead on your child's financial education by showing them the ins and outs of savings and checking accounts long before introducing the plastic. That way, when your children do get their hands on that "magic card," they'll realize that any tab they run up is really just taking away from their holiday gift haul anyway.
6. Using your credit card at the ATM Here are two words that personal finance experts would love for you to forget: cash advance. On your credit card agreement, you'll see all sorts of different interest rates and fee amounts. One of those percentages is the high rate you'll be charged for taking cash out of an ATM with your credit card. It might seem like easy access when you need paper instead of plastic, but there's generally no grace period on cash advances, meaning you'll be charged that high interest rate starting from the moment you hit "Return card" on the screen. If you're really that hard up for cash, you're not doing yourself any favors by paying interest to get it. If you can't take it out of checking or savings, maybe you shouldn't be taking it out at all.
7. Throwing away credit card numbers It may feel like identity theft is only something that happens to other people, but the trash from your home passes through many people's hands before landing in its permanent home. The amount of information that we throw out is more than enough to provide thieves with the opportunity to hijack our financial lives. To prevent against identity fraud, invest in a quality paper shredder and shred your credit card offers, credit card checks and statements, as well as utility statements. Credit expert Beverly Harzog even suggests cutting up or shredding your old credit cards and throwing half the card away one week and half the card then next week. If an ounce of prevention is worth a pound of cure, then a shredder weighing 10 pounds is a lot of cure.
8. Giving your credit card out over the phone Perhaps you're getting a jump on holiday shopping ordering through the Hammacher Schlemmer catalog, in which case, paying by credit card over the phone is certainly acceptable. However, many scams are conducted by unsavory individuals calling to tell you that your utilities are about to be turned off (they're not), or you're the winner of some great contest requiring a credit card (you aren't) if you'll just provide your credit card information. Thieves count on flustering you with scare tactics or exciting news to get you to provide any information they request. When in doubt, hang up and call the organization back using a phone number found on statements or the official website. A good rule of thumb: if you didn't originate the phone call, don't give out your personal information.
9. Paying more than you should in fees Are you experiencing exhaustion, frustration and irritability upon seeing itemized fees on credit card bills? Then you may be experiencing fee fatigue. The good news? Smart credit card companies offer products that might help you avoid tunnel vision when paying your bill. Are you a globetrotter? Get a card that doesn't charge foreign transaction fees. Fashionably late with your credit card bill? There are cards that waive late fees! There's no reason to waste money on fees. With some basic research, you can make theswitch to a card that saves you some green instead of making you see red.
Whether you're trying to save money or save your financial identity, spending a few mindful minutes on credit card savvy practices could end up saving both. Sounds like an intelligent move, smartypants.
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