Credit cards mean different things to different people, and most of it has to do with your experience. For some, credit cards represent high-interest rates and a gateway to mountains of debt. For others, credit cards are some mysterious and forbidden last-resort option. And for some people, like me, credit cards are a gateway to free travel.
Surely it can’t be as simple as that, though, right? I mean, can you have the best of those three options without falling into any of the other options along the way? It is actually pretty easy to manage, and it all comes down to educating yourself on how they work and making a game-plan for your usage of them.
Credit cards are relatively straightforward. You use them to pay for bills and expenses and instead of the money being pulled directly from your account, it gets stacked up against your “credit limit”. Aka the amount that the bank decided it could trust you to pay back when you applied for the card. Then, after a month of using it, the bank will ask for a minimum payment that goes towards your entire balance. Ideally, you pay off the entire balance so you do not have to deal with interest (which is usually pretty high for credit cards).…