4 “Smart” Credit Card Moves that are Actually Dumb

Getty Images
Getty Images

Used wisely, credit cards can help build your credit score and earn you sweet perks. But to get smart about the plastic in your wallet, you have to shake free from common myths that can actually tank your score or cost you unnecessary money. 

1. YOU RELY EXCLUSIVELY ON A DEBIT CARD.

The perks of debit are clear: It’s harder to overspend than if you use a credit card, and you can’t work yourself into a mountain of debt. That debt aversion might explain why those of us who got our financial footing during the Great Recession are more leery of credit than other generations: According to a Bankrate survey, two-thirds of people ages 18 to 29 don’t have a credit card, compared with only one-third of people over 30.

“But it’s dangerous to assume that all plastic is treated the same way by credit reporting and scoring agencies,” says credit expert John Ulzheimer, who spent years at FICO and Equifax. “Only credit cards make it onto your credit report, so if you avoid them you’re really not doing anything to help your credit score or establish your credit report.”

Even if you don’t plan to apply for a car loan or mortgage anytime soon, when you are ready to apply, those lenders will factor the age of your credit report into their decision. Opening a credit card in your 20s will mean you have a more, ahem, mature credit report than if you open one in your 30s, which can help you get a better or bigger loan—even if your finances are otherwise unchanged.

The Truly Smart Move: Go ahead and apply for a credit card (free services like Credit Karma can help you determine the appropriate card). If you’re worried the new piece of plastic will tempt you to splurge beyond your means, don’t keep it in your wallet. 

2. YOU CARRY A SMALL BALANCE EACH MONTH.

Credit scoring agencies want to see that you’re using your credit cards regularly, because that signals that you can responsibly handle the credit available to you. But somehow that truth morphed into a widespread myth that you shouldn’t pay your bill in full.

“Carrying a balance from month to month will just cost you interest and won’t help your credit score,” says Bethy Hardeman, chief consumer advocate at Credit Karma. In fact, it could hurt it, because lenders look at how the amount of your current balances compares with your total credit card limits. The lower the balance, the better.

So how do you prove regular use and earn your financial brownie points? Relax—credit card companies do the work for you. When you swipe your way to a $200 balance on your Visa, the company reports that amount to the credit reporting agencies at the same time that it issues you a bill. You can then pay that balance (in full!). And keep in mind that regular use doesn’t mean you have to use the card monthly or hit a certain spend threshold. Modest use every couple of months works just fine.

The Truly Smart Move: Set a calendar reminder so you pay your balance in full and on time to avoid getting hit with late fees. And if you find that “regular use” is turning into “regular splurges,” use your card to set up auto-pay on a boring bill instead. It’s tougher to be tempted to go on an electricity spree.

3. YOU DECLINE A CREDIT LIMIT INCREASE.

When Visa mails you an offer to increase the credit limit on one of your cards, you demur. Time for a pat on the back, right? Not quite. When FICO determines your credit score, one of the biggest numbers it looks at is your revolving utilization. Also known as credit card usage percentage or balance-to-limit ratio, this is basically a fancy way of saying how much you owe on your credit cards compared with how much your total limits are. “If you owe $500 on a card with a $500 limit, you’ll have a lower score than someone who owes $500 on a card with a $5,000 limit,” says Ulzheimer. 

To calculate your current revolving utilization, divide your balance by the credit card limit and multiply by 100. Quick example: If you owe $1,000 on a card with a limit of $2,500, your revolving utilization of that card is 40 percent. While 40 percent might sound boss at first blush, consider that consumers with the highest credit scores tend to have revolving utilizations under 10 percent.

One way to better your revolving utilization is to pay down your balances. But another is to increase the credit limits on existing cards. So the next time MasterCard extends an offer, think twice before you decline.

The Truly Smart Move: Many credit card companies will reassess your limit every three years or so, when they reissue your credit cards. But you can also proactively ask for an increase. You’re more likely to secure a higher limit if you’re a low-risk consumer: You use your cards regularly and pay your bill on time. 

4. YOU CANCEL SOME OF YOUR CREDIT CARDS.

Maybe your wallet is crazy cluttered with a million cards and you’re looking to streamline. Or maybe you’re sick of all the temptation that comes with having multiple cards. Or maybe you think having one card is safer when it comes to identity theft. No matter what your motivation, closing a credit card will ding your credit score, because it reduces your revolving utilization.

“Never, ever close a credit card,” says Ulzheimer. “The only time a card should be considered for the chopping block is if it has a huge annual fee and you’re planning to never use it again.” It’s especially worth waiting, he says, if you plan to apply soon for any type of credit, including an auto loan or student loan.

As for identity theft, keep in mind that if your account info is somehow stolen, all four of the major credit card networks offer total fraud liability. That means, if you spot a suspicious charge on your statement and you report it to the credit card company, you’ll pay nada.

The Truly Smart Move: The best way to kill both clutter and temptation—without wounding your credit score—is to shred the plastic you don’t want to use anymore. If you ever decide to start using that particular credit card again, you can put in a call to the company and have the card reissued at no expense.

The 8 Best Horror Movies to Stream on Hulu Right Now

Paramount Pictures
Paramount Pictures

Looking for a good scare this Halloween season? If you’re a Hulu subscriber, you’ll be able to get your fill of creepy content. Check out eight of the best horror movies currently streaming on the service.

1. Hellraiser (1987)

Horror author Clive Barker made the move to feature directing with this tale of a man (Sean Chapman) who makes the grievous error of opening a portal to hell and proceeds to make his brother’s family targets of the sadistic Cenobites, led by Pinhead (Doug Bradley). Don’t bother with the endless sequels; the original is the best (and goriest) of the lot.

2. Invasion of the Body Snatchers (1978)

Paranoia runs deep in this remake of the original Invasion of the Body Snatchers (1956). In the ‘70s iteration, Donald Sutherland plays a health inspector who can’t shake the feeling that people around him seem a little off. He soon grows wise to the reality that aliens are walking among us as virtual human replicas. Naturally, they’re not keen on being discovered.

3. A Quiet Place (2018)

John Krasinski and Emily Blunt star as a couple living in a world terrorized by creatures that hunt by sound. Their largely-silent existence means every stray creak, cry, or noise threatens to expose them to the monsters—a danger that's only compounded when Blunt discovers she’s pregnant.

4. The Orphanage (2007)

A sense of dread looms over The Orphanage, a Spanish-language thriller with Belén Rueda as Laura, who returns to the child care facility that raised her so she can make a difference for a new generation of children. Strange things begin as soon as she arrives, with her son going missing and hints of unwelcome guests unraveling her nerves. It’s a film best not watched alone.

5. Event Horizon (1997)

If 1979’s Alien stirred your interest in space scares, Event Horizon might make for a worthwhile watch. After a spaceship presumed lost suddenly reappears, a crew of investigators (Sam Neill, Laurence Fishburne) board to find answers.

6. Children of the Corn (1984)

A couple (Peter Horton, Linda Hamilton) passing through a small rural town find a lack of adult supervision curious—until the kids reveal themselves to be homicidal cult members. Based on a Stephen King short story.

7. Evil Dead 2: Dead by Dawn (1987)

Bruce Campbell and Sam Raimi perfected “splatstick” horror in this cult classic about hapless boob Ash (Campbell) who escapes to a remote cabin retreat with girlfriend Linda (Denise Bixler) and unwittingly unleashes a cascade of evil. Though it’s more amusing than scary, Raimi’s inventive imagery is morbidly fascinating.

8. Child’s Play (1988)

Good mom Catherine Hicks buys a Good Guys doll for her son, Andy. Unfortunately, the doll—dubbed Chucky—has been possessed by the spirit of a serial killer (Brad Dourif) and proceeds to make young Andy’s life miserable, particularly after he discovers the kitchen cutlery.

25 of Oscar Wilde's Wittiest Quotes

By Napoleon Sarony - Library of Congress, Public Domain, Wikimedia Commons
By Napoleon Sarony - Library of Congress, Public Domain, Wikimedia Commons

On October 16, 1854, Oscar Fingal O'Flahertie Wills Wilde was born in Dublin, Ireland. He would go on to become one of the world's most prolific writers, dabbling in everything from plays and poetry to essays and fiction. Whatever the medium, his wit shone through.

1. On God

"I think that God, in creating man, somewhat overestimated his ability."

2. On the world as a stage

"The world is a stage, but the play is badly cast."

3. On forgiveness

"Always forgive your enemies; nothing annoys them so much."

4. On good vs. bad

"It is absurd to divide people into good and bad. People are either charming or tedious."

5. On getting advice

"The only thing to do with good advice is pass it on. It is never any use to oneself."

6. On happiness

"Some cause happiness wherever they go; others whenever they go."

7. On cynicism

"What is a cynic? A man who knows the price of everything and the value of nothing."

8. On sincerity

"A little sincerity is a dangerous thing, and a great deal of it is absolutely fatal."

9. On money

"When I was young I thought that money was the most important thing in life; now that I am old I know that it is."

10. On life's greatest tragedies

"There are only two tragedies in life: one is not getting what one wants, and the other is getting it."

11. On hard work

"Work is the curse of the drinking classes."

12. On living within one's means

"Anyone who lives within their means suffers from a lack of imagination."

13. On true friends

"True friends stab you in the front."

14. On mothers

"All women become like their mothers. That is their tragedy. No man does. That's his."

15. On fashion

"Fashion is a form of ugliness so intolerable that we have to alter it every six months."

16. On being talked about

"There is only one thing in life worse than being talked about, and that is not being talked about."

17. On genius

"Genius is born—not paid."

18. On morality

"Morality is simply the attitude we adopt towards people whom we personally dislike."

19. On relationships

"How can a woman be expected to be happy with a man who insists on treating her as if she were a perfectly normal human being?"

20. On the definition of a "gentleman"

"A gentleman is one who never hurts anyone’s feelings unintentionally."

21. On boredom

"My own business always bores me to death; I prefer other people’s."

22. On aging

"The old believe everything, the middle-aged suspect everything, the young know everything."

23. On men and women

"I like men who have a future and women who have a past."

24. On poetry

"There are two ways of disliking poetry; one way is to dislike it, the other is to read Pope."

25. On wit

"Quotation is a serviceable substitute for wit."

And one bonus quote about Oscar Wilde! Dorothy Parker said it best in a 1927 issue of Life:

If, with the literate, I am
Impelled to try an epigram,
I never seek to take the credit;
We all assume that Oscar said it.

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