Thinking about making a credit card purchase? Before you swipe your card, consider how much you can afford to charge. It will have an effect on your wallet and your credit score.

One of the principles of building a good credit history and staying out of debt is charging only what you can afford to pay. But just how much is that? The amount varies from one person to the next depending on each person’s income, expenses, credit limit, and other credit card balances.

Charge only what you can afford. The amount you can afford to charge mostly depends on your discretionary income – what you have left after taxes and other necessary expenses have been paid. Read more »

You sign up for a card at 7.99%. Send in one payment a couple of days past the due date, and your interest rate could jump to 19.99%. If you’re late again, it could leap as high as 29.99% ! What’s more, the companies monitor your credit history closely.

Make a late payment on one card and all your cards may raise their rates. Speaking of lateness, your bank may have a fixed hour for receiving your payment on the day it’s due. If it’s supposed to be in by 10:00 a.m. and doesn’t get posted until 4:00 p.m., you will be charged a late fee.

$$ Saver. Pay your credit card bill as soon as possible after it arrives. You may have just 2 weeks to guarantee that your check arrives on time. Read more »

There are 2 instrumental options here :

Bring the payments up to date. If you cannot make the payments on all your credit facilities, to avoid further spoiling your credit history, you should restructure your loans.

For example: You can lengthen the tenure of the loan so the minimum commitment every month becomes less, or you can look at rate reduction or at the possibility of consolidating your loans with a cheaper loan.

Speak to your respective bankers to figure out the best way to normalize your repayment behavior. It is true enough that most banks will try to help and restructure their customers’ loans.

Consider debt consolidation. If you owe on credit cards and have mortgages, you could ask the bank to extend a bigger line for the mortgages in place of some collateral to pay off your credit card bills.

Or you can ask for a top-up in terms of mortgages and use the money to pay your outstanding debt.

Upon normalizing the payments, the credit report should then reflect your new clean report.

If you’ve decided that prepaid credit cards are the right choice for you, there are quite a few options available that can offer you varying benefits.

Perhaps you’re looking to repair or restore your credit. Maybe you want a way to give your away-from-home student a monthly allowance. No matter what your reason, why not choose a prepaid credit card that allows you to earn income at the same time?

Prepaid Credit Cards That Help You Rebuild Your Credit. Not every financial institution that issues stored value credit cards makes reports to credit agencies about your spending history.

If part of your reason for applying for a prepaid card is to repair your credit history, make sure you choose a company that does. There are also a number of issuing companies that offer credit reporting as an add-on service for an additional fee.

Prepaid Credit Cards That Pay You Back. Some major financial institutions will offer you a prepaid credit card with an opportunity to make income. They offer a rebate on spending, or a referral program.

If you don’t need to build your credit, and believe that your income through spending rebates and referrals will exceed the annual membership fees, then these types of cards might be a good choice for you.

What ever your reason for selecting a prepaid credit card, just make sure that you shop around to get the best deal, and that you check out the company to make certain that they are a reputable one.

Many consumers close credit cards after becoming what seems like too delinquent to catch up. As a matter of fact, closing out a delinquent credit card will hurt your credit more than it will help.

Here are five credit cards that you should never close.

1. Any Credit Card That Still Has a Balance. When you close a credit card that has a balance, your total available credit is lowered to $0. Since you still have a balance on that credit card with no credit limit, it looks like you’ve maxed out.

The amount of debt you have is 30% of your credit score; so a maxed out credit card, or one that appears to be maxed out, can have a very negative impact on your credit score.

2. Your Only Credit Card With Available Credit. Closing out this card will decrease total available credit and increase your credit utilization, which, as before, is not a desired situation.

3. Your Only Credit Card. Since part of your credit score into consideration the different types of credit you have, keeping a credit card in the mix will add points to your credit score.

You could get turned down for a credit card in the future because the creditor thinks you don’t have enough experience with credit cards.

4. Your Oldest Credit Card Account. Closing out your old credit cards shortens your credit history. Lenders tend to view borrowers with short credit histories as riskier than borrowers with longer histories.

5. The Credit Card With the Best Terms. Why let a good thing go? If you have a credit card that has a low interest rate, no annual fee, and other perks like travel insurance, keep it.

A credit card that charges you less for making purchases is far better than one that charges you more.

It’s ok to close out a newer credit card that you no longer use as long as the card does not have a balance and you have other credit cards.

The proper way to close a credit card is by sending a written notice to the card issuer. For your records, you should request written confirmation that the account was closed in good standing.

You should be just as selective about the credit cards you close as the ones you open. Before you pick up the phone to alert your creditor that you want to close your account, make sure it’s not going to affect your credit score in a negative way.