6 Habits of Highly Successful Credit Card Holders

There’s no doubt that adopting bad credit habits can plunge you into a cycle of constant stress and financial problems. Luckily, it’s never too late to correct course and whip your credit back into shape. Consider adopting the six habits below from the most successful credit card holders to better manage your credit card debt. Even if you can't do every one right now, do what you can.

Habit #1: Statement Monitoring

Highly successful credit card holders get in the habit of monitoring their credit card statements. Instead of just paying what they see, they take the time to go through the statement and make sure everything is correct. There could be errors and/or fraudulent charges, and it’s important that you catch them. If you find any errors, report them to the credit card issuer as soon as possible so that you’re not held liable. You definitely don’t want to be paying for things you didn't purchase.

Habit #2: Pay in Full and on Time

Never want to pay interest on your purchase? Simply pay your monthly statement on time and in full. Instead of just paying the minimum balance, paying your bill in full can reduce headaches and large interest charges in the future. This can also reduce any late-payment penalties your card issuer may enforce. Another great perk to paying in full and on time is by doing so you are also establishing a positive credit history. According to Bankrate, paying more than 30 days late can bring down your credit score and leave a blemish on your credit report for up to seven years.¹ Avoid costly situations like this by setting up autopay or registering for email alerts with your issuer. 

Habit #3: Track Expenses 

The last thing you want is to be shocked when you open your credit statement. Therefore, it's important that you keep track of your credit expenses. Luckily, there are many money management apps like Mint and You Need a Budget (YNAB) that can help you keep track easily and on the go. Check your expenses routinely to make sure you are within your budget and avoid anxiety once your statement arrives. If you have a financial planner, ask if they offer a budgeting software tool!

Habit #4: Shop Around for Offers 

Any successful credit card holder is always on the lookout for better offers. Comparing any new offers to the card you already have can never hurt. Look at the advantages and disadvantages and see which card might work better for you. Some things to compare when shopping around include fees, rewards, credit limit, grace period, interest rates, how the payments are calculated, etc. Here's a nerd wallet page with excellent credit cards for 2020!

Habit #5: Establish a Credit Budget

It’s easy to let your credit spending limits get out of hand because you know you won’t have to pay until later. However, this mindset leads to continuous swiping, and before you know it, you are well above your budget. The important thing is not the card limit, it’s your own personal limit. Successful card holders are mindful of their spending and make sure they don’t continuously buy things they can’t afford. 

Habit #6: Find Rewards 

Who doesn’t love getting money back? Seek out a credit card that will reward you for being a loyal customer and spending to get the most bang for your buck. Don’t just settle on a card that gives 1 percent cash back on everything for example. Instead, find a card that matches your spending habits. If you travel frequently, get a card that offers travel rewards. If you drive a lot, get a card that offers gas rewards. If you take the time to review your spending habits and do some research, you can have the chance to earn back hundreds of dollars. 

Overall, the best rule of thumb for becoming a successful credit card holder is to avoid spending what you don’t have. Whether you’re a first-time card holder or have been carrying a card for decades, by following the six habits above you’ll be well on your way to happy, healthier credit.