Credit cards are a simple financial product that’s complicated not only by credit card terms, but also by human behavior.

Your credit card issuer gives you the option of paying a small portion of your credit card balance rather than the full thing. And because parting with hard-earned cash is a kind of painful experience, many people choose to make the lower, easier minimum payment.

If you’re having some financial trouble or maybe you’d just rather buy concert tickets than make your credit card payment, your credit card issuer won’t punish you too severely. They’ll add a late fee to your account and require you to pay it back when your next due date rolls around.

Your credit card issuer gives you a credit limit, but doesn’t really police how you use your credit card. They won’t tap you on your shoulder and warn you if you’re getting too close to your credit limit. Sure, they won’t let you spend over your credit limit, but what if your credit limit is more than you can afford to repay? Well, we’re back to the beginning – you can just pay it back over a period of time with minimum payments.

You see, it’s really easy to mess up with credit cards. Spending money feels good. Paying it back doesn’t feel good. If you want to build a good credit score – and trust me, you do – here are the three most important credit card rules to know. Follow these and you’ll never have trouble.

Always make your payments on time.

Timely payments are the best thing for your credit score. The more on-time payments you have, the more your credit score benefits. Credit card payments that are more than 30 days late go on your credit report and affect your credit score.

Your credit score isn’t the only reason you should pay on time. Paying on time prevents late fees.

The first time you’re late on a credit card payment, your late fee will be up to $27. If you’re late again within the next six months, your late payment can be as much as $38. Catching up after falling behind can be tough since you’ll have to make up the missed payments plus pay the late fees.

In addition to late fees, you’ll also have to worry about how late payments can affect your interest rate.

Credit card issuers are allowed to raise your interest rate to the penalty rate if your payment is more than 60 days past due. (This is actually an improvement. They used to be able to raise your rate after just one late payment.)

The penalty rate is the highest rate charged on your credit card and leads to higher finance charges on any balance you’re carrying. The rate will go back down for your existing balance after you’ve made six consecutive on time payments. However, your credit card issuer can still apply the higher rate to any purchases made after the penalty rate became effective.

Paying on time is much better all around.

Only borrow what you can afford to pay back.

Knowing how much you can afford to pay back requires you to know your finances well. You’ll have to be aware of your income, expenses, and disposable income to be sure you’re not charging more than you can afford to pay.

When your credit card balance is too high to repay, you risk paying late and running into all the consequences that come with a late payment.

Your credit score could be impacted if your credit card balance is too high. That’s because part of your credit score considers your credit card balance relative to your credit limit. This ratio is known as your credit utilization. Generally speaking, having a credit utilization over 30% can hurt your credit score. Keep this amount in mind as you’re considering how much to spend on your credit card each month.

Pay in full each month.

Sure, your credit card issuer only requires you to pay the minimum on your credit card, but paying this way helps the credit card issuer make more money. When you pay only the minimum, a large part of your credit card payment goes toward interest and your balance only goes down a small amount each month. Your credit card issuer makes a lot of money in interest if you pay off your balance with minimum payments.

You can avoid paying credit card interest by paying your full balance before the grace period ends. The grace period will typically apply to purchases when you pay your full balance the previous month. Cash advances and balance transfers typically don’t have grace periods.

Not only does paying in full keep you from paying interest, it also ensures you never carry credit card debt. If something happens to your income, you won’t have to worry about struggling to make credit card payments. As long as you only charge what you can afford, you’ll never have a problem paying your full balance. And, some months that might mean not using your credit card at all.

If you stick to these basic rules, not only will you limit the cost of using your credit card, you’ll also build and maintain a good credit score.

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