You did it!
You finally got that credit card that you’ve always wanted. It’s time to freakin’ celebrate, but before you max out your entire credit limit to “treat yo self,” like Tom Haverford and Donna Meagle did in “Parks and Recreation,” you have got to do these five essential things.
Create an account and activate the card
It’s all very simple.
As long as you’ve got a smartphone or tablet, you should immediately download the banking application that corresponds to your credit card. Every major card has one. Once it’s been downloaded, create an account and link your card to it.
Most new credit cards will come with a sticker containing instructions on how to activate the card, and you should be able to do it without breaking a sweat. Either through the app, a website or by phone, you should be able to quickly activate your card. Spending ahoy!
Don’t worry about signing the back of your card. Merchants aren’t supposed to accept cards without a signature, but fewer and fewer cashiers check to see if the card is, in fact, signed. What’s more, according USC Title 15 Section 1643, signing a credit card actually limits the credit card issuer’s liability on fraud.
Don’t get shocked by shifty interest rates
Chances are that if you’re a savvy shopper — and we’re assuming you are — that you signed up for that shiny new card and got a pretty sweet promotional interest rate. Unfortunately, those rates don’t last forever. You’re going to want to identify when those interest rates expire and mark the actual date on your calendar.
At least a week before that date hits, re-asses whether your card is all it’s cracked up to be. Then be prepared to call your credit card company and re-negotiate your terms... or cancel that card if isn’t worth it.
Also mark your calendar for the dates your annual fees kick in. Make sure to know everything you’ve signed up for so that you don’t get hornswaggled out of any hard-earned cash.
Set up your payment
Eventually you’re going to have to pay off what you spend on your credit card. Be sure to set a regular, monthly payment date in advance, and make sure you can handle it financially. The smartest thing you can do is pay off the entire balance every single month.
If you can manage it, then definitely enroll in a recurring auto-payment program. It’ll make your life much easier not having to worry about any late fees. If you don’t want to sign up for autopay, then set a calendar reminder to pay -- again, if you can -- your entire balance every month. You’ll earn good credit without having to spend more than an item is worth.
Either way, just make sure you do it before the interest and late fees start piling up.
Learn the rewards program
Let’s face it: All that stuff above is pretty boring. Now that you’ve gotten that stuff out of the way, you’re almost ready to start spending. But first, you’ll want to see what kind of rewards you can earn by using your card.
For some cards, it’s as easy as using your card on every purchase, while others may require you to shop at a certain store or restaurant.
Try identifying individual perks that you know you can meet to maximize your savings. (Otherwise, WTH are those rewards good for?) For example, if your card offers $500 cash back after spending $2,000 in the first month, then budget and set a realistic deadline, so you can actually earn that lucrative reward.
Owning a credit card is risky. No matter what precautions people take, there is always chance of having your card number stolen. But there are ways to protect yourself.
Security researchers say that customers should make it a habit to check their credit card balance every single week. If a charge seems weird to you, call your credit card company. That peace of mind costs you nothing.
Multiple security experts also believe that you should never pay bills or shop online using public WiFi because there is a higher risk of getting hacked.
Whether you store your prized possessions in a wallet or a deep, dark bunker under the sea, make sure it’s in a place that only you have access to. It’s never fun to get an email that your child maxed your credit card out on Amazon or that your identity has been stolen.