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5 Tips for Spring Cleaning Your Wallet

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Advance Personal Finance

Advance Personal Finance

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As the flowers start to bloom and the days become a little longer, many of us start to come out of our winter hibernation. We find ourselves spring cleaning just about everything; our house, our finances and even our wallets. If a thorough cleaning of your wallet is needed this year, make sure you follow these tips.

Eliminate your credit card debt

The average American has over $15,000 in credit card debt. If this sounds a little like your situation then use this time to sit down and really dig deep into your finances. How many cards do you have that you are currently carrying a balance on? What is the interest rate on each of them? In December the Federal Reserve decided to raise the prime rate by 0.25%. Because of that some credit card issuers have followed by increasing the interest rate on their cards. Use this time to come up with a plan to eliminate your debt now. If you need a little extra help then you can look into a balance transfer credit card.

Get to know the rewards on your cards

If you are currently carrying a rewards credit card then now is a great time to become familiar with all the benefits that it has. Does it give you bonus points for shopping at supermarkets? Will you receive lounge access the next time you are traveling through an airport? Make sure that you are using all of your cards to the fullest. Just keep in mind, that you need to pay your balance in full each month or you will accrue finance charges, which negate the rewards that you have earned.

Check on your credit limit

The general rule of thumb for the amount of available credit you should be using is 30%. If you frequently find yourself consuming more than this each month then you should look at increasing the credit limit on your cards. This isn’t an open invitation to start spending more, but it will help to lower your credit utilization. As you know this is a major piece of your credit score.

Get to know your card benefits

Most of the top reward credit cards all come with some really great benefits. It could be trip insurance or even purchase protection. These benefits can have a high value if they are ever utilized. There are also some cards that will offer statement credits for things like Global Entry or even airline fees. Read up on all of the benefits that come with your cards so you can take full advantage.

Consider a new credit card

After looking at all of the benefits that your credit cards include, do you feel that something is missing? If you do then it might be time to take a look at the different cards that are available. New cards are released all the time so there might be something that better fits what you are looking for with your lifestyle.

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