How to Manage Revolving Credit

Revolving credit can help you pay for things until you get paid again. Also, buying things you need to buy anyway with a credit card that gives you rewards is a great way to get money back. Just make sure you do it correctly.

Keep low balances. With a credit card or other forms of credit, you can use up to the full amount of credit you are given. That doesn't mean you should do it, though. If you use up all of your available credit, your credit score will go down. If you can't pay off your balance, you can also ask for your credit limit to be raised. But the most important thing is not to add more debt to your new, higher limit.

Every month, pay on time. Most issuers will charge a late payment fee, and some will raise your APR on future purchases as a penalty. If your payment is at least 60 days late, you may have to pay a penalty rate, and a late payment could cause your credit score to drop by a lot.

The most important thing you can do to keep your credit score high is to pay your bills on time.

Don't apply for too many lines of credit at once. Make sure your credit score is good before you apply for a credit card or other type of credit so you don't get turned down. And if you get the loan, don't apply for more loans right away so your credit score doesn't take a hit.

Depending on how you use it, revolving credit can either help or hurt your credit score. If you spend wisely and pay your bills on time, you should be able to use credit to your advantage and build a good credit score at the same time.
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