What are Credit Card Myths and the Pre-Qualifications for getting a Credit Card?

What are Credit Card Myths and the Pre-Qualifications for getting a Credit Card?

What are Credit Card Myths and the Pre-Qualifications for getting a Credit Card?

(Last Updated On: April 6, 2018)

At least about 2/3 of the world’s population make use of credit cards but not all of them can use them properly. This  has ultimately led to an increase in credit card fraud. In this article, you’ll be understanding more about credit card myths and smart ways to use your credit card.

First, let’s treat the credit card myths, are they really important? Credit card myths are mere words spread by  people. if you believe them they may affect your personal finance management positively or negatively. You need to have a good knowledge of credit cards so that your mind will be at peace  always.

These are the most common credit card myths.

  • You must always have some balance left on your Credit to improve your Credit score or pay off than you owe:

Many believe that when they pay their card provider more than they owe it increases their credit card rating and score but this is definitely not TRUE. This act will only increase your available credit which you can use to pay for goods/services; it never improves your rating.

Others believe that they must always have some balance left on their card so as to build a great credit card score. Continuously leaving a balance might incur unnecessary interests that can prevent the rewards you have earned by using the card. Using your credit card responsibly can save some money for you or earn you rewards steadily.

 

  • Using a debit card is safer than using a credit card:

A Debit card will expose your bank account details to the possibility of fraud. Once your debit card is unsafe, it might take weeks before the fraudulent activity is detected.

Credit cards remain the most secured and preferable payment system for any transaction, especially the ones done on the internet. If you use debit cards and a fraudulent act is suspected by your financial institution, your entire balance could be held up for some time if it’s not reported quickly.

 

  • You should have only one credit card

You’ll come across this myth when you’re starting to build your credit score. Although having just a credit card will help you minimize your spending and save more money it is not a must that you should have just one credit card. If you can efficiently manage more than one card, then you can have more one credit card.

If you are acquiring a second credit card, get a card that gives rewards which would be useful to you.

There are a lot of credit card myths out there, but these three are the most common.

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