If you have included saving money and reducing debt in your resolutions for the new year, you’re not alone. A recent survey found that 32 percent of Americans plan to “save more, spend less ”, while more than a quarter (27.5 percent) intend to pay down debt in the new year. As with most resolutions, sticking with a
savings plan can be difficult; challenges arise throughout the year, from unexpected expenses to a reduction in work hours. Because many families’ financial lives are unstable, putting aside savings to draw from is one of the most important things that you can do. Not only will having savings help when the proverbial rainy day comes
along, but savings can help you avoid the need to take out costly payday loans, or pay penalty fees for late payments.
One tip suggested that many financial experts suggest is to get a secured credit card (a secured card requires a cash collateral deposit that becomes the credit line for that account). Secured cards offer numerous benefits.
First, they use your savings to establish the line of credit. If you get the Citizens Trust Bank VISA CLASSIC Secured Credit Card for an example, as little as a $600 deposit* gives you a $500 line of credit.
An important distinction: Secured cards are not prepaid or debit cards. The money that you have secured stays intact and adds to your buying power of a
Another benefit of secured cards is that they can help rebuild credit. Secured cards report to all the three major credit bureaus, so when you make payments on time you are building your credit file. Over time with responsible credit management, having a secured credit card can help improve your credit score.