Tips for Wise Credit Use

When you need credit, you need to make sure you get the best deal you can.  Here are some tips:

  • Shop around for the best offer and interest rate. Higher interest rate means more money out of your pocket.
  • Think of credit as the use of future income.  You need future income to buy things on credit.
  • Don’t get a credit card just because they’re giving something away. If you are new to using credit, this can be very harmful to you.  Think before you sign up for an offer.
  • Pay bills on time, so you won’t have to pay late fees or jeopardize your credit history. Currently, 35% of your credit score is determined by how you have paid your bills in the past.
  • Pay bills in full each month, so you won’t have to pay finance charges.
  • Pay more than the minimum amount due. Debts will be paid off sooner, and you’ll save money. Credit card companies require you to pay around 4% of the total bill. This means you are usually not paying much on principal.  A software program can help you see how much you are actually paying on each debt.
  • Know how much debt you can handle. Payments shouldn’t be more than 15% of your monthly take-home pay (excluding your mortgage).
  • Get a free copy of your credit report once a year and make sure it’s accurate. . .  To request a copy choose one of the following methods:

By phone – Call Toll Free Number – 877-322-8228

Copies of the form are available at

Information you need when making the request: your social security number, date of birth, and address if you have moved within the last two years.  Each of the three nationwide reporting companies may request information only you would know to maintain the security of your file.


Susan Taylor

Resources are important whether you are looking to rent your first apartment, pay your bills, buy your first home or send your child to college. There are many ways to save money to reach your goals, and hopefully ISU Money Tip$ will be one of them. I enjoy traveling, needlework and am a novice gardener.

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One thought on “Tips for Wise Credit Use

  1. I wish more people would use this type of common sense before they try to handle credit. I noticed how “spend more with a credit card than you actually have” wasn’t on the list. Of course I’m being silly, but I am always surprised at how many people actually use a credit card in this manner. It blows me away.

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