These days a credit card is, for anyone 18 or older, almost a “must-have”. When used wisely, a credit card can build a robust credit history to help you get that home loan you may need further down the road.

A credit card can help you pay expenses when you’re short on liquid funds in your bank account.

What many people don’t know is that efficient and knowledgeable credit card use doesn’t have to cost extra money above and beyond your purchases. Credit cards can even add value to your lifestyle.

Here are six smart ways to help make your credit card(s) work for you.

1. Take advantage of the benefits

If up to now you’ve just had a debit card, you know that the money you spend is withdrawn from your bank account immediately. If you don’t have that money, you can’t use it.

But using a debit card also makes you susceptible to hackers and people who can crack all your bank information.

If you don’t have a credit card, you may do yourself more harm than good in the long run.

Credit cards actually offer you benefits that a debit card does not, like certain perks and discounts. They are also good to use for transactions that have a higher risk factor, like online shopping.

2. Pay your credit card bills on time

This is one of the biggest mistakes you can make because you will incur extra charges by missing just one payment. If you pay your bill just 30 days late, your credit score can be severely impacted.

And if, for some reason you pay your bill 60 days late, your interest rate will skyrocket, as will the penalty rates the credit card company charges you.

3. Refrain from making just the minimum payment

Making only the minimum payment due on your bill is a surefire way for the credit card company to assume that you cannot manage your finances.

They perceive that you perhaps don’t have the money to support the credit card that you have.

Such a situation could result in problems for both them and you. By paying just the minimum, you could also rack up much more expense in interest over time. Try to pay even just RM50 more than the minimum to help get yourself out of the hole.

4. Check your statement regularly

How are you supposed to know exactly what is going on with your credit card account if you don’t examine what’s going on with it? That’s why you get regular statements.

Only by checking your statement each month can you find errors that the company might make, or even fraudulent transactions by third parties.

You may save yourself from difficulty getting refunds or fixing mistakes if you don’t wait too long but rather check it promptly and thoroughly.

5. Don’t charge more to your card than you can pay

Having a credit card is nice, but if you don’t think rationally about how you use it and just how realistically you can pay off that monthly bill, you can have a problem.

If you are charging more each month than you can actually pay for, you will eventually wind up with piles of debt and find yourself too far behind to catch up on those payments.

Think wisely before using your card on larger purchases.

6. Don’t pay big medical bills with your credit cards

One big mistake that many people unwittingly make is paying medical bills with a credit card. It’s not a great idea.

Smaller charges like medications and co-pays are okay, but significant procedures are definitely not okay. Using a credit card can keep you from getting discounts on your medical costs or converting charge activity into any reward in the future.

It is better to make other arrangements with the clinic or hospital where you had the procedure.

In a nutshell, holding a credit card is not tough as long as you make the monthly payments and are aware of how to properly use the card without picking up bad habits.

You certainly don’t want to find yourself with tonnes of debt because you made a stupid mistake. Think about what will have the most positive impact on your financial future, and you will be able to make wise decisions about using your credit card.

Being aware of potential missteps will actually help you be a smarter credit card user in the future.

This article first appeared in The New Savvy.

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