I just got my first secured Credit Card from Bank of America with a $500 limit?
How do I use it and how much do I use, I really want to use it just right.
Can someone lay out a plan for 3-6 months 6-12 months and so forth.
Can I use it to pay for gas, how much a month?
Can I use it to pay for another credit account from a jewelry store where I pay $50 dollar installments per month?
I have no credit and only have the jewelry store account and this new card, and I am trying to learn how to build, use, and maintain good credit. I am new and young to all this so please advice me as best you can.
Oh, and do I have to put the money I use back into the secured account?
Wow, this is too confusing!!!
Sarah,
Thanks, yes they report to the 3 credit agencies, and I only spent $500 at the jewelry store and I am on my 3rd payment of $50, and I gave down $200.
Try to use $100 or less per month and pay the bill ON TIME and IN FULL. You can use it to pay for gas at almost any station that has a “pay at the pump” option. Just use it like you would a debit card or another credit card. As for if you can pay the installments from the jewelry store, it really depends on the store. Check with them, but pay them on time, just as you would with the credit card. Does the jewelry store report this installment loan to the 3 bureaus? I hope you aren’t spending TOO much on a piece of jewelry!
If you pay your bills in-full and on time every month for six months, there should be enough information available to create a credit score. Just make sure that you check your credit report online at www.annualcreditreport.com (the government’s site… it’s free and doesn’t hurt your score, unlike freecreditreport.com — if you look on that site, there’s a link to the government’s website, which is the only free report that’s legit out there) for correct information. Your score will cost you and you don’t really need to worry about it until you need a loan, such as for a car or a mortgage.
Keep paying on time and make sure that you don’t max out your card and you should be fine.
To pay your card, you can either pay online from your bank account (you’ll have to set up “electronic bill pay”) or you can mail in a check to the credit card company. It’s actually safer to pay online, but it still takes 2-3 business days, on average, for a payment to clear.
Best of luck!
Why is America collecting people’s credit card numbers? (02Dec10)