Checking Your Credit Card Health
Keeping An Eye On Your Credit Card Situation
If there's one thing that can be said about credit card debt, it's that it can sneak up on you faster than you realize. That's why I suggest reviewing your credit card health every other month. That way, there are no unpleasant credit surprises suddenly upon you. Here are some easy ways to keep an eye on your credit card situation.
Where Does Your Available Credit Stand?
One of the best ways to keep an eye on your credit card health is to keep an eye on your available credit. If your available credit is less than 50 percent of your total credit, there's a problem.
So how do you tell where your available credit stands? Add up all of the credit you have on all of your credit cards combined. For example, if you have one credit card with a $500 limit, one with a $1,500 limit and another with a $2,000 limit, your total available credit is $4,000.
With the above scenario in mind, if your credit card balances combined are less than $2,000, you are at less than 50 percent of your total available credit. If they're higher, you're in trouble and you need to start paying down your debt before you charge anything else.
How Is Your Payment History?
Are you able to pay more than the minimum monthly payment on your credit cards each month? If not, you need to re-evaluate your credit card situation. You should be paying as much as you can towards your credit card balances, not just the minimum monthly payment.
Every two months, look at the above two credit situations. If all remains well, you have nothing to worry about. However, if you notice some worrisome trends developing, make the necessary adjustments to maintain your credit card health.