Tips for using your credit card

If used correctly, a credit card can help you spread the cost of purchases, earn reward points, manage debt and build your credit score.

These credit card use tips can give you confidence to use your credit card effectively, without getting you into financial difficulty.

Your choice of credit card will depend on your goals. Do you want to make a big purchase? Are you looking to earn reward points for spending? Or, do you want to consolidate your credit card balances? When you're shopping around, compare the benefits offered by different cards, as well as any fees and charges.

To use your credit card without having to pay interest on purchases, pay off your balance in full every month. This can also help you avoid building up debt. If you can't do this, it still makes sense to pay more than the minimum in order to reduce the amount of interest you'll pay. If it helps, you can stagger your repayments through the month so that you chip away at the debt.

Sometimes when you're very busy it can feel difficult to manage all your bills and repayments. This can lead to late payment fees and damage your credit score. The easiest way to make sure your credit card repayments are always made on time is to set up a Direct Debit.

You should be comfortable with the amount you spend on your credit card. To make sure this is the case, your credit limit should be set at the right level for you. If you need a little extra flexibility, and you know you can afford it, you can always ask your lender to increase your limit. On the other hand, if you're worried about being tempted to overspend, you can ask for it to be reduced.

Many credit cards offer rewards such as cashback, air miles or reward points that can be redeemed in stores or online. There are lots of different credit card offers available, so you can shop around and check the details to find the offer that appeals to you.

While rewards are good, don't get swept up in them. Make sure that all the conditions of the card suit you – such as the annual fee and other service fees.