It is important to realize that while many people stress the importance of building your credit that you may end up damaging it if you do not use your charge card account wisely. Additionally you can qualify for a home mortgage without having a credit card account. It may be a bit more difficult to find a lender, but it does not mean that you will have to pay a higher annual percentage rate. If you want to build your credit using a credit card you need to follow these four steps to do so safely.

Limit the Number of Cards You Have

You do not need more than one charge card account. This includes gas cards, store cards and any other type of charge card account. One credit card account is all that you need. If you have too many credit card accounts it reflects poorly on your credit report. You may justify your store cards because of the discount. The stores are not offering the discount to be nice. They know that the majority of people do not pay off the balance in full each month, and they make a lot more in interest than they offer you in savings. It can be tempting to spend cash you do not have when there is a sale. Don’t tempt yourself.

Limit Your Credit Limit

You can call and request that your bank will not automatically raise your credit limit. This will stop you from getting out of control with your spending as well. You may consider setting your limit at $500.00 or $1000.00. This should be plenty to handle any spending that you may need to do in one month. If you focus on paying off these lower amounts, you should be able to fairly easily.

Pay Off Your Balance in Full Each Month

You build your credit history by showing that you are responsible in meeting your monthly payments on time, regularly. Pay on time and the full amount each month. By staying within your budgeted amounts on all your spending, you should be able to do this. You can avoid carrying a heavy debt load by simply never charging something that you can not pay cash for. This is the most important thing you can do to show that you can manage your finances and build your credit history.

Avoid the Free Offers That Come with Credit Card Applications

You may be offered free pizza, t-shirts and numerous other gifts for applying for a charge card account. You may figure that signing up just once will not hurt anything. You will cancel the card as soon as you receive it. These canceled cards do show up on your credit report. Save yourself the trouble by simply not applying. This will save you money and time in the long run.

Finally, when looking for the best charge card for building credit or any reason for that matter, make sure to use a reputable credit card comparison website like www.1-2-3-CreditCards.com. Also, you should start with Discover credit cards or Chase credit cards.

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