Guide to Credit Cards: So You Think You're Such a Smart Credit Card User?
Over 70% of US households now use credit and debit cards. The average household has almost 8 credit cards, and charges over $15,000 per year to them. Why? Because credit cards offer convenience, rewards, purchase protection and easy credit.
You probably think you use credit cards wisely. But the facts suggest otherwise. Credit card companies are highly profitable, and their profits come straight out of consumers' pockets. Over 60% of credit card users pay steep interest rates to borrow money on their credit cards. Even those who avoid borrowing on their credit cards tend to get hit with hefty late payment fees at least once.
Even if you avoid borrowing on your credit cards and think you use your credit cards well, you probably allow credit cards to lull you into overspending. And you probably have a credit card that offers inferior terms and rewards (air miles anyone?).
This goal of this guide is to show you how to choose and use credit cards for maximum profit. It's not for people snowed under with credit card debt, who probably need to wean themselves off credit cards altogether. (Almost 70% of people who file for bankrupcy say that their bankrupcy was caused by credit card debt, according to the American Bankrupcy Institute.) Rather, this guide is aimed at people who think they use credit cards wisely but could do a lot better.
Most advice about credit cards is produced by credit card companies or web sites with direct advertising relationships with credit card companies. That probably results in biased and distorted advice.
This guide is different. While it's supported entirely by advertising (we get paid only if you click on an ad), we have no direct relationship with any advertiser. In fact, we don't even know which ads will appear on this site. So we're not afraid to be brutally honest about credit cards and the credit card companies, and to give honest, unbiased advice.
This guide will show you how to choose and use credit cards wisely and profitably. The starting point is to understand how not to lose money with credit cards. To do that you need to know how credit card companies make money, and therefore what they will encourage you to do.
That's what we'll discuss next.
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