Credit cards, branded as a prerogative status, are issued by local credit card companies and governed by credit bureaus. Like any mode of financing, cardholders inherited the privilege of utilizing unsecured debts from the issuers. Such form of borrowing has been available to almost any consumer who provided evidence of business profits or employment incomes.


Applying for credit cards is a double-edged mechanism, two facades which make or break your financial destiny. If you’re in search of signing up for the best credit cards in year 2018, and assurance from reputable card companies, consider the following factors before taking any action. Financial prudence and wisdom may be of great assistance near future.


What are the dos of credit card?

Signing up for a new credit card, as a corporate or individual, takes approximately 10-15 minutes. A personal banker assigned by a financial institution shall contact you for relevant documents such as proof of address and operating income from a job. Upon furnishing the required details for compliance purposes, the credit card officer reviews all information and ensures accuracy in submitted documents – calling you for additional evidence(s) whenever needed. The entire workflow is about 2-3 hours during business days and up to two day for detailed checks.


After verifying your identity and payment history, the credit card company proceeds to issue approved cards and you’re the new owner to them. Get ready to receive a cake and have a share in doing credit repair (the fun way of course). An obligation is to observe the five dos of credit cards namely; 1. Rebuild credit, 2. 0% interest-free installment, 3. Shopping & travel rewards, 4. Balance transfer scheme, and 5. Investment program:


1. Rebuild credit: Do you know that credit cards can help in repairing bad credit? If you’re have a bad credit score of 300, average credit score of 609, or any scores within the range, having an approved credit card helps in fixing payment history. If you’re looking to rebuild credit the right way, financing small purchases such as grocery, utility bills, or insurance premiums, could improve credibility in the eyes of creditors such as banks or credit unions.


Management of credit cards is an uphill task. You’ve to pay close attention during credit fixes, missed payment, loss of data, overspending on costly goods, or even purchasing foreign unlicensed products – your card issuer is closely monitoring on your credit report and consumption behavior. One wrong move may dent your entire individual ratings and subjected to blocking of any unused unsecured debt. Adhere to the strict financial regulations when trying to do personal credit repair.

Cardholder: You can sign up for capital one credit card or discover credit card to rebuild credit. Such prestigious card companies received brand recognition from local government bureaus as well as other creditors trusting your scorecard easily – boosting your reputation across financial institutions and lenders.


2. 0% interest-free installment: How about getting an attractive financing rate of zero percent? If you’ve an average credit score of 500-650, credit card companies do offer 0% interest free installment deals pegged to your credit cards. As a lucrative option, financing big-ticket purchases such as quality furnishing, current insurance policy, new auto, or fresh college loan, should render financial assistance in saving some money in the short haul. Over time, the savings from bank’s interest may be put to good use, and avoiding potential perils of the nominal inflation rate.


Management of 0% interest-free installment is a chore. You’ve to be meticulous in dealing with credit repair, late payment, breach of contract, overleveraged on non-essentials, or continuous loading of new financing deals – bank loan department frequently liaised with creditors to perform credit checks and determine potential risk of delinquency. One invalid payment may jeopardize the entire financial status in the eyes of creditors and subjected to removal of any incentive scheme. Adhere to the terms and conditions of the contractual agreement at all times.

Cardholder: You can peg any of your hsbc credit card or american express credit card to finance 0% interest free installment as a mode of payment. Such reputable card companies do provide certain forms of guaranteed credit protection, in case of merchant fraud or sudden business closure – a financial intermediary beneficial to both vendors and consumers.



3. Shopping & travel: Where can you find a business paying you for entertainment? If you’re a shopaholic or in the lines of spending borrowed money, credit card companies do incentivize shopping and travel deals in accordance to customer tiers. As an enticing consumer benefit marketing campaign, financing retail consumption such as grocery, dining, entertainment, golf, beauty, fitness, or travel, might advance your financial education in cost of personal budgeting. Thereafter, planning for monthly spending shall lead you to be disciplined in developing good money management skills.


Management of shopping and travel is not indulgence. You’ll need to be fully conscientious in swiping your credit card for the right purpose, citi premier miles for travel, gold visa credit card for entertainment, uob lady’s card for retail shopping, or wells fargo credit card for general consumption – consumer credit division closely tracking your spending pattern and figuring out new marketing ways to increase consumption. An innovative cashback scheme can easily reduce your healthy gearing ratio, thereby creating unnecessary economic frictions. Adhere closely to your budgeted purchases and install a routine application to keep track of individual spending habit.

Cardholder: You’ve to make tough financial decisions in signing up for loyalty points or cash rebates – deciding the appropriate retail credit cards or personal travel mileage cards. Many creative financial institutions occasionally set-up promotional roadshows, enticing diners to dine in shopping malls, business travelers to use bank’s line of credit, offset bills, or other incentive methods – tied-up partnerships with multiple vendors and bolstering economic productivity for everyone.


4. Balance-transfer: Are you confused in tracking thick wads of monthly billing receipts? If you’re overwhelmed by the sheer volume of receipts or frustrated by the loss of bills, credit card companies do set up balance transfer programs to consumers who have multiple credit lines. As a financial mobility planner, financing balance transfer such as 0% interest free installment, credit card debt consolidation, interest offset scheme, or balance transfer program, could properly segregate your financial plan for optimal placement of expense. Accordingly, transferring of balance between current and saving account helps in improving financial reflex in cash appropriation.


Management of balance transfer is not one-stop process. You’ve to remain active in handling ongoing transactions within the balance-transfer program, consolidating credit card debt, utility bill transfer, monthly insurance premium payment, other card expenditure, or existing balance transfer scheme – credit card office to update daily transacted volumes and identify new processes to enhance reliability of financial traction. Adhere to the stipulated balance-transfer agreement and log-in daily to actively manage incoming transactions.

Cardholder: You’ll be in-charge of sourcing for new balance transfer schemes available or removing high interest credit cards – proactive attitude in settlement of outstanding amounts within the stipulated deadlines. Many relationship managers introduce new transfer of balances, financing at attractive interest rate, free consolidation of loan, or at a small cost – generating new ideas to educate you in managing debt payment and benefiting the global financial system.


5. Convenience: Where do you store heaps of cash in your lean purse? If you’re facing an abnormal situation hoarding cash or cash equivalents, credit card companies deliver an excellent service in manufacturing “plastics”. As a trusted storage for money surplus, financing credit cards such as visa card, mastercard, amex, or licensed card issuer, provided a mode of convenience for handling cash transaction seamlessly. Soon, crediting of balance between buyer and seller lowers the cost of carrying in money management.


Management of convenience is not easy though. You’ll practice to safely store your new credit card in wallet compartment among other sections, gold visa credit card, hsbc premier, citi miles card, american express, or capital one credit card – banking compliance division frequently contacted merchants to detect suspected frauds or unpaid transactions. Adhere to keeping credit cards safely stored and set-up message alerts for outgoing payments.

Cardholder: You’ve to be a responsible cardholder in exchange for pursue of convenience or favorable transacting volume – adopting precautionary measures in maintaining safety of credit cards and guarding against identity theft cases. Local credit card companies have 2-FA authentication modes plus relevant credit shield protection as safety mechanisms – creating multiple layers of security, enabling you to swipe freely without security concerns on information leakage or breach of privacy.


What are the don’ts of credit card?

Applying for a new credit card, usually for retail spending purpose, takes up a short period of time. An officer arranged by a credit card company will liaise with you on the necessary information such as internal banking policy, financial regulation, credit bureau check, and other key obligations. Once you’ve been brief on the required set of rules, the local banking department finalized detailed checks and submitted to investigation division. The entire handover takes approximately 1 working day and up to a week for pending card compliance.


Undergoing a hassle in ensuring accuracy and fraud detection, the credit card department issues the final approved cards and you’ve to take full accountability of any discrepancy. Prepare to face the music and receive harsh penalty treatment if improper handling of card ownership is found (not exactly fun). Below is a list of the five dons of credit cards mainly; 1. Poor financial discipline, 2. Repay another credit card, 3. Sign up for unnecessary cards, 4. Reveal personal information, and 5. Cash advances:


1. Poor financial discipline: Do you know that credit card companies do track customer’s consumption behavior? Indulgence in impulsive spending is not encouraged. If you’re a vivid shopaholic in purchasing goods on credit, new furniture on installment, mobile line plan, or simply swiping on-the-go, chances are red flags have been raised in the eyes of creditors. Banks engaged data analytics companies to trace consumer spending behaviors as well as determining the risk of delinquency – high volume transactions yield higher probability of credit card default.


Management of poor financial discipline is tough. You’ve to get rid of irrational exuberance in excessive commitment in retailing, increase financial planning, streamline shopping tendency, or setting up highly focused spending indicator – credit card office is tracking the type of individual expense while investing in risk perimeter to locate high-risk customers. Practicing financial prudence in limiting consumption budget does signal positive credit score ideas over to unsecured lenders.

Controller: You’ll make an impactful decision not to unnecessarily overspend on goods or engage in high-risk inventory – implementing financial trackers in handling overall credit consumption and deliberately missing out on new financing deals. Personal banking applications provide a free money outflow tool (usually in the form of a banking app) for you to keep a lookout – raising “eyebrows” upon clear detection of over-the-coverage limit, thereby forcing your entire cash flow to be congested temporarily.


2. Repay another credit card: When are you going to be debt free? If you’ll to continue financing debts using debts, paying another credit card bill using another card, or transferring balance to another balance-transfer account, credit ensnarement is going to last a lifetime. As a convenient way of settling unpaid debts, it is only a matter of time when your personal coverage limit burst and interest on loan surpassing the principle repayment – yes, there are many ongoing legal suits filed by creditors and borrowers undergoing bankruptcy attempts.


Management of credit card repayment is a must to do. You’ve an opportunity to secure properly or seek financial advice from professional credit repair companies – setting up multiple savings and current accounts with local credit unions or savings & loans association. Financial institutions had designed special interest-yielding accounts to offset existing cost of borrowing as well as freezing interest rates after negotiating for an extended deadline. Practicing frequent communications with lenders enforce you to remain financially discipline in managing on-time credit card payment.

Controller: You’ll impose strict cash repayment on outstanding amount or paying off unpaid bill using another credit card – demonstrating the independence of not needing a credit card to repay another. An officer will be in-charge of calling you for clarification if your card has been used as a repayment scheme to that of a similar line of credit.


3. Sign up for an unnecessary credit card: How many cards can you use at once? Multiple cards, both debit and credit functions, do not necessarily equate to rebuilding of credit. Financial institution like bank, credit card company, shopping mall tie-up loyalty card, or other offshore credit card service, knew the risk of hoarding a full spectrum of cards. As a cardholder, no one will entrust the entire suite of credit line to you, only condition is to be a high-flyer in business development or simply from a wealthy background.

Management of unnecessary credit card is emotional. The fact that reward point, loyalty to branding, promotional event, or pooled rebate can easily be wasted especially after accumulating for a 12-month period. Think of the repercussion of using too many credit cards while losing out potential value to maximize one perfect card for optimal rewards. Another way is to imagine maxing out credit utility ratio (>30% of total limits) and finding your credit score lowered down – unable to apply for a mortgage or auto.

Cardholder: You’ll be terminating unused credit card or line of credit. Therefore, fixate a benefit plan for utilizing relevant credit cards, but cancelling others to deter unnecessary consumption. One good way is to seat down with your personal banker: he/she has the knowledge to reveal the pro and con of credit card while finding the best debit cards to offset loss of card or line.

**Warning: You’re ultimately responsible for choosing the best credit card or charge card. No one knows your personal spending pattern more than you do. The right way is no other way – using cash to pay for small items, balance-transfer for debt consolidation, or ready credit (overdraft facilities for emergency).


4. Sharing of credit card details: “Sharing is not caring”, an old adage to be observed by global cardholders. You’re being irresponsible for revealing any credit card information, sharing of credit cards with a friend or relative, divulging personal information, allowing anyone to view your credit profile, or helping a pal to pay for a good. Most consumers, in the U.S. and U.K., reported identity theft to the police. It’s not hard to detect either of the aforementioned loss of credit card reasons. Card dealing is a common practice in the underground black market, caveat emptor!


Management of credit card information is dire. You’ve to be caution on a (non-exhaustive) list included: a. signing up for too-good-to-be true deal, applying for an offshore banking account, a credit repair franchise, business corporate card purchase, any business without a physical location, or customer support officer random phone call. It’s important to always meet-up with the respective correspondence who inquired on such credit-related information – one of the best identity theft protection in credit repair.

Safeguard: Applying for credit card insurance is a good option. Why not prevent identity theft from happening in the first place. Closely observe the above list or seek credit card company’s protection policy in an attempt to replicate those who undergone credit card frauds in the past – execute preventive measurements immediately.


5. Using cash advance service: Cash advance, a subset of bank overdraft, is a credit function to draw cash in advance. Interest rate is calculated on a daily basis, bearing in mind of debt compounded interests. Cash advance comes in the form of ready credit, cash line, bank overdraft, alternative for ineligible payday loan, credit card limit, balance-transfer top-up or other attractive line of credit – credit compliance department monitoring your spending behavior and reporting to credit bureaus.

Management of cash advances has to come with sacrifices. Opportunity cost has to be measured before utilizing such services. It’s been reportedly warned for general consumers suing credit card company’s policy when interests on cash advance go beyond that of initial borrowing sum (principle amount) while bank’s lawyer countersue on failure to read daily interest rate calculation on cash advance facilities. There is no end for either party so the best way is to mitigate credit card risk or even avoidance of a credit card.


Overdraft: You’re liable for the actions taken in withdrawing cash on credit. Pertinent information like daily interest rate, the ability to repay debt, unpaid bill, missed payment, or any “hidden” clause has to be understood before applying for cash advance overdraft. One bad payment or default on borrowing can cause legal implication(s) such as lawyer’s letter from bank or claim on personal asset – think twice.


Alternatives of credit card

Finding difficulties in digesting the law of credit card? Alternatives of credit consumption are always available in the form of money, cash, debit card, Paypal, Bitcoin, foreign currency, or even third-party peer-to-peer financing.


Recently, the growth of mobile payment gateway has served the need for a cashless society. If you’re on-board a financial trend, using of such payment application(s) help to reduce financial dilemma, getting perk and incentive in using the app, cash rebate directly from merchant, or learn about new competitor’s product offering – matching your personal spending needs in a high quality fashion.


Learn more about the do’s and don’ts of credit repair to better align your interest with the required consumer spending pattern – avoiding debt pitfalls ensnared by local creditor or fraudster that predecessors went through (bankruptcy filing or financial nightmare at home).


Quote of the Day: “No one manages your personal money more well than you do – KIG Hall [2013-2018]”


Relevant Topics

» What is a Credit Report: Learn more about using a report card to your advantage!

» What is Credit Repair: Find out various means to fix current sorrows!

» What is a Credit Card: Accumulate latest incentives and interest rates here!

» What is Credit Score: Boost your current credit scores!

» What is Personal Finance: Receive high-quality education to financial prosperity today!


This article was originally published on February 06, 2014. It has since been updated.