• Locations
  • Contact
  • Rates
  • Schedule Appointment
  • Login

  • New Loans and Accounts: 602-433-5626
  •  Service: 602-433-7000
  •  Routing # 122187238

Make a Credit Card Work For You — Not Against You

Many people may regularly use a credit card without realizing or understanding all of its perks and pitfalls. But by learning how to use a credit card wisely, cardholders can pay with convenience, build up their credit score, earn rewards and safeguard their credit from fraud — while not damaging their credit rating or creeping into debt.

A credit card can either be a smart spending tool to build good credit and earn rewards — or a way to borrow and spend money you don’t necessarily have, which can help you get by when money is tight, give you the means to purchase something big you pay off over time and possibly, land you in debt. With credit, there are pros and cons, but as long as you know how to use a credit card with discipline and knowledge, you can benefit from its perks.

Let’s walk through opening, understanding and using a credit card, starting with choosing the best one for you. Whether you’re a beginner or seasoned credit card user, the following information can help ensure you’re using it responsibly and to your advantage.

Choosing the Right Card

There are hundreds of credit cards to choose from — and it’s up to you to choose the right card based on its fees, interest rates, perks, rewards and purpose. Many people choose to open multiple credit cards to meet various needs and goals.

Which Credit Cards are Right For You?

The Cost of Credit

There are two costs to be aware of: fees and interest rates. Make sure you understand what fees come with the card, such as a balance transfer, cash advance, late or annual fee. Cards with a high annual fee tend to offer bigger benefits, so you’ll want to determine if the annual fee is worth paying to get the better perks. In most cases, you’re charged with interest in exchange for borrowing money. If you carry a balance month-to-month, you’ll incur interest.

Helping or Hurting Your Credit Score

Your credit score plays a big role in your financial life and goals, such as getting a loan approved (e.g., mortgage or car), lower interest rates/finance charges, higher borrowing limits, a better auto insurance rate and approval for apartments/rentals. This score informs lenders on how well or poorly you manage debt, which impacts your approval and interest rate.

Your credit card is one tool for building, repairing or increasing your credit score. If you pay off your balance on time each month or more than the minimum, keep your credit utilization below 30% and develop a good credit history, you’re establishing a healthy credit score.

On the other hand, if you abuse your credit card, you’re hurting your credit score. Skipping or making late payments, maxing out your card, incurring a high outstanding balance and closing an account can all have the potential to negatively impact your score. Now, let’s say you prefer to use your debit card, you’ll still need to establish a history of good credit, which you can do by using a credit card for purchases here and there and paying it off at the month’s end.

The Risk of Accruing Credit Card Debt

As much as we’d like, a credit card isn’t a magic wand that you can wave to buy whatever you like whenever you want. Giving yourself that kind of permission may likely put you on a road toward debt, which happens when you can’t afford to pay off your outstanding balances that accumulate with interest monthly. Keep these tips in mind to help prevent you from racking up the average household credit card debt of $7,849.1

  • Don’t miss payments and pay the balance in full each month (or at least pay more than the minimum balance).
  • Adjust your spending habits once you can no longer afford to make payments.
  • Be realistic with your purchases. Rationalizing your overspending is a red flag for debt.
  • Build up your savings, so you don’t have to rely on a credit card when money’s tight.
  • Maintain a low debt-to-credit-ratio (the amount of credit you’re using vs. the total amount available to you).
  • Try not to carry a balance for too long which will increase due to interest.
  • Prepare for a large purchase, rather than charging it to your card.
  • Don’t be fooled by keeping a low balance on multiple credit cards. This only gives the illusion that your spending is within reason.
  • Be mindful of debt denial, which can happen when you only focus on making the minimum payment while ignoring the overall balance or remaining limit.

Credit Card Fraud and Safety

Debt isn’t the only risk of using a credit card. Credit card fraud happens when someone steals your card or obtains your card information to make fraudulent purchases. Your personal information could also be stolen and used to apply for a credit card in your name. There are various types of credit card scams to know about to help prevent you from financial loss or identity theft.

A best practice is to regularly monitor your account and statements for any unauthorized charges. In most cases, victims have zero liability — just remember to report the theft immediately. Also, never give your credit card info to someone whom you don’t trust, sign up for alerts of fraud or charges made and check your credit report to see if any cards were opened in your name.

Maximize Your Card’s Benefits

Rewards cards incentivize you to use your credit by offering points for traveling, hotels, cash back, gift cards, merchandise and other perks. You’ll want to take the time to research your options and choose a card with rewards that match your lifestyle, needs and where you spend the most. Words of advice: Make sure you learn about any fees and don’t spend more than you normally would just to earn on your purchases.

Using a credit card can either help or harm your spending and finances. Credit cards can earn you rewards, help you reach a high credit score, build credit history and provide fraud protection. Credit cards aren’t necessarily good or bad by nature — it’s how you use them that determines if they positively or negatively affect your finances.


Pay down balances, choose where you earn the most cash back, use rewards the way you want or build your credit!



The material presented here is for educational purposes only, and is not intended to be used as financial, investment, or legal advice.