Credit expert Nancy Marescotti offers the following advice for credit card holders for the new year.
1. Reduce your costs: Minimize your post-holiday bill payments in January by transferring your credit card balance to a low interest rate card or speak to your bank about a low interest line of credit.
2. Make your credit card work for you: If you collect rewards such as AIR MILES Reward Miles, the money you are spending all year round will earn you rewards that can be redeemed towards next year's holiday gifts or a trip to see the family. Another reward option to look for is "Cash Back" which could provide a meaningful cash rebate at the end of the year.
3. Minimize cost and maximize value: A low interest rate and earning rewards can be equally important, so find a card that lets you do both.
4. Stick with one credit card: Having just one credit card bill to pay at the end of the month is a lot less hassle and also makes it easier to track expenses. In addition, using a single card means you're collecting only one type of reward -- allowing you to accumulate faster.
5. Get a card designed just for you: When determining your credit card needs, consider how you shop, how you manage your finances and what aspirations you have that a card might help make possible. Then you have to do a bit of homework; shop around and do the comparisons.
6. Pay for what you use: Use a card that allows you to choose only the rewards, special features and the interest rate option you want. The annual fee of a card reflects all the features and benefits, so don't pay for options that you don't use.
7. Read the fine print: Know how to collect rewards and how much you are spending to get them. You'll maximize the rewards you collect if you are able to earn rewards in multiple ways. For a real apples-to-apples comparison of the required spending, look at different credit cards to see how much you need to spend to earn a flight from Toronto to Vancouver.
8. Know your rights: As a cardholder, your credit card company must tell you about:
- The card's annual interest rate
- The grace period
- Other charges or fees that might apply to your use of the card
- Any optional services you may wish to have
- Any other charges or fees that may apply
- A telephone number that you can call during business hours to obtain information about your account
9. Learn to budget: Whether it's holiday shopping or just day-to-day expenses, planning a budget is an important personal finance strategy, and it's likely easier than you think.
10. Get organized: Keep a copy of your credit card number and the financial institution's name and telephone number in a secure place - making it easier for you if you ever need to report a lost or stolen card.
