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Most people aren’t using credit cards responsibly, and it’s costing them a fortune.

If you’re considering signing up for your first credit card, or if you have one already (or more!), you need to make sure you are using credit cards responsibly. This article is going to cover some of my credit card tips for beginners and seasoned users that have fallen into some bad credit card habits.

Believe it or not, sometimes credit cards can be a great financial tool! They’re a safety net that’s there when you need it, and many even offer some neat perks.

However, there is a dark side to credit cards, as I’m sure you know. And for most people, the cons often outweigh the pros.

Related4 Extremely Simple Steps for Getting Out of Debt

using credit cards responsibly

Scary Credit Card Statistics of Those NOT Using Credit Cards Responsibly

A 2015 Nerdwallet study shows that the average US household carries approximately $15,675 in credit card debt.

Keep in mind, that’s just credit card debt. That doesn’t include mortgage debt, car loans, student debt, etc.

What’s more, that number could be severely underrepresented…In 2013, lender-reported credit card debt was 155% greater than borrower-reported balances. That means a lot of people are in denial when it comes to exactly how much credit card debt they have.

The average household pays nearly $2600 every year in credit card interest.  That’s over 3% of the average household income ($75,591).

We have a serious credit card debt problem in this country! The most significant contributor to this massive debt problem is the lack of knowledge about how credit cards work and how to use credit cards responsibly.

If you’re new to the world of credit and you’re wondering how to use a credit card for the first time, this is exactly where you can start. If you have experience (and negative at that) then these credit card tips will help you as well.


How You’re NOT Using Credit Cards Responsibly

There are a few common pitfalls that many people make when it comes to using credit cards.

Applying for Too Many Cards

The first mistake many make is simply applying to too many credit cards.

When you apply for a credit card, a “hard inquiry” mark is put on your credit history.  This can be viewed by other credit companies and may negatively affect your credit score.

A bad credit score can hurt your chances of getting credit down the road.

Credit card tip: Keep it simple. Try to keep your applications for credit cards to a minimum.  Do your research, find the card you like, and apply solely for that card.  And remember to read the fine print!

Curious about your credit score?  I recommend using Experian to see where you stand (and FYI, checking your own credit score won’t hurt it further!).

Only Making the Minimum Payment

The second mistake is that most people make only the minimum payment each month on their credit card bill.

And it’s about the worst possible thing you can do.

Carrying a revolving balance on credit cards can not only reduce your credit score, but will also end up increasing the total amount of interest you end up paying on the debt- by a lot.

Paying a little extra each month (or paying your bill in full) will pay off your credit cards much faster.  And the faster you pay off credit cards, the less interest you have to pay.  Don’t give away your hard earned money to credit card companies!

If you have multiple credit cards with a balance, you might want to focus paying extra on the cards that are charging you the highest interest rate each month.  By targeting the high interest cards first, you’ll end up paying less in interest over the long run.

RelatedGetting Out of Debt | Stop Paying Interest and Start Earning It

Using Credit to Supplement Their Income

Many people use credit as a  way to float from paycheck to paycheck or whip out their credit card whenever they get the chance.

Say you pull in $3,000 each month from your job.  The best way to run up a large credit card balance is to get used to living on a $3,400 monthly budget with the help of credit cards.

Many people say “if you don’t have the cash for it, you don’t need it.”  Don’t fall into the trap of putting living expenses on your credit card every time you go shopping… and then not pay it off each month!

smartest way to use a credit card - credit card tips for beginners

How to Use a Credit Card Responsibly: The Smartest Way

Learn these three cut and dry rules of credit card responsibility inside and out. They explain the smartest way to use a credit card in the simplest way.

Understand the Fees, Rules, etc When Choosing a Card

Whether you’re new to credit cards, or a seasoned pro, it’s always wise to do your research before picking out your card.  There are plenty of sites that compare cards and will help you find the right card for you.  One that I have personally used and highly recommend is This website has many different categories that you can sort cards by and will allow you to find the best rates!

Use Points and Cash Back to Your Advantage

Cardholders often find it useful to just use their cards for gasoline, and then pay the balance off at the end of the month. Note that last part… pay off the balance at the end of each month.

I do this, and it’s a great way to keep your debt to a minimum and increase your credit score.

People with higher cash flow may find it beneficial to put more expenses on their credit cards and pay off the balance at the end of every month.  This is a great way to reap the benefits of cash back rewards and other perks on upper tier cards.

Pay Your Balances on Time. Always.

One of the biggest ways to hurt your credit score is to be repeatedly late paying your bill. Missing even one payment can be crippling but if you do have late payments showing on your reports, it is possible to get some or maybe even several of them removed.

On the flip side, many credit cards companies will reduce your rates or give you higher credit limits if you consistently pay your bill on time. Most credit cards offer the ability to pay your bills online- which is a surefire way to make sure your bill gets paid on time every month.

Credit card companies will have no problem raising your rates and hitting you with fees if you don’t pay your bill on time.

Be Very Careful With Credit Cards

Spend the time getting organized and making a plan for your credit card utilization.  Credit card debt is a massive problem in the US and it’s easy to rack up a large balance, which can cripple your financial health.

Don’t fall into the trap that most do when not using credit cards responsibly!  Be smart about your purchases and your payments. Maintain a healthy credit score and you’ll be on your way to financial stability and growth.

David Coleman

1 comment
Gaurav Jain 1 year, 2 months ago

Loved the post!! I have gone through various posts and blogs which help us in managing our Credit Cards responsibly. Keep up the good work.

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