Adult decisions => dislike

[lmcgiglez]

So I went to Kohl's because I needed some bras ASAP (I have very few in rotation right now, and two of them now need repairs [again] because the under-wire is making a break for it) and I was fairly confident that Target would NOT have a size I can wear, and the stores in the mall would be more expensive (a bra from Torrid is almost $40). Not that

Comments

[happycrabmearii]

I don't have a Kohl's card but it is a very good idea to have a credit card. A $300 limit tells me that you have little to no credit, and you want that credit! The worst thing you can do now is to cancel the card, that affects your credit very badly to cancel a card account within the first year or so of opening it. The second worst thing you can do is to never use it; that also affects your credit badly - it doesn't not affect it, it actually lowers it. The best thing you can do is to use it sparingly, and do NOT pay it off every month, leave a $1-$5 balance on your card 2 out of 3 times, as paying your card off every month tells creditors the same thing as if you weren't using it at all. Paying it off entirely once in a while is the best thing you can do for your credit (like once every 3 months). A $300 limit is good if you don't plan on using it much, but it's not very realistic if you ever plan on relying on it to get you out of a spot (I just used mine to pay the $700 car repair I had done today). BUT you don't want a limit that is too high for 2 reasons: you can get in debt very easily, and having a high limit that you never approach in usage is also bad for your credit - they like to see you using about 60%-75% of your limit on average. I had an almost $12,000 limit on mine a few years ago and I asked them to lower it to $6,000 (where it is now) because at once I had $10,000 on it (that was tough to pay off) and also it was lowering my credit having it so high once I had paid it off.

Also, whatever you do, do not use the checks they are most likely going to send you. Most creditors send their members blank checks as another source of funding, but when you use one, it creates an entirely different line of credit under your account, with a MUCH higher interest rate. So, say you owe $50 on your credit card, and the interest rate is 10% (potentially $5); you also wrote out one of the checks they sent for another $50 and the interest rate on that is 20% (potentially $10). If you send them a payment of $75 before your due date to avoid interest, they will pay off your credit card first, and then put the rest on your check account, so you still owe 20% interest on $25. They will always use your money to pay off the account with the lower interest rate first. Bottom line: never use the checks a creditor sends you.

Some other tips I suggest :) Register online so you can pay your bill on their website and get in on their latest offers for cardholders. Sometimes there are pretty decent ones. Also, see if they have a point reward system, and if so, if you qualify for it. Also, check your policy and see what your interest rate is - if it is over 12% I would call and ask them to lower it (sometimes it works!). Try not to use your credit card's cash advance option if it has one (i.e. use it like an ATM card) this comes with a big ole fee..also, try not to get too close to your limit, if you find yourself within 25% of your limit, call them and ask them to increase your limit, because all it takes is your payment not going through (usually $15 fee) and then causing a late fee (usually $25) for it to max out - which will result in, yes, another fee.

I wouldn't worry too much, though, $300 should be a super easy to handle :) (wait til you get one with a $25,000 limit and need to use it for a mortgage refinance or something! eek!)