Credit cards can be a great tool. They’re convenient, help build your credit history, and come with benefits like cashback and travel rewards. For all their virtues, however, credit cards can come with a big downside when they’re not used wisely. They can tempt us to spend more than we normally would and things can quickly spiral out of control before we even realize.
You’ve probably heard a lot about your credit score over the years, but have you ever actually looked under the hood and try to better understand it? If you’re answer is no – don’t worry, you’re not alone. Surveys have shown that Americans simply don’t know enough about how credit scores work and the effects their score can have on their lives.
Credit utilization: What a sexy topic, right? It’s up there with Annual Percentage Rates and 401(k) rollovers. Despite the impact credit utilization can have on your credit score, aka your life, I’ve noticed very few people understand it.