Think Before You Swipe

We all know it’s important to think before you speak, but what about before you swipe (your credit card, that is!)?  We also can probably all agree that credit cards have their distinct pros and cons.

Credit cards are a great way to build your credit score (which lenders consider in terms of financing) as long as they are managed responsibly.  But, because credit cards are simple to obtain and use, it is easy not to even think of credit card balances as debt.  A good rule to stick with is if you can’t pay for it in cash today, don’t put it on your credit card!  And most importantly, pay off your balance each month to avoid increasing debt and high interest rates.

Here are a few interesting facts about credit card usage:

• In 2011, the United States’ household debt was $793.1 billion – 98% was credit card usage
• 2/3 of Americans have credit cards
• 54% of Americans pay off their credit card balance each month
• The average American has 4 credit cards
• The average credit card interest rate is approximately 19%

It is easy to see how credit cards can be a positive or negative factor when it comes to managing your finances, but just remember to “think before you swipe.”