by Joseph Kenny | 10/22/08

Times are testy in the United States. The nation is in a slump, and thousands of citizens are pushing their finances to the breaking point to try and compensate for the weaknesses of the economy. The housing market has fallen apart, the mortgage industry has suffered an almost fatal blow, the dollar has weakened in the global market, and the international demand for oil is up. With all of these things combined, Americans are finding it tougher than ever to try and make ends meet.

One of the biggest concerns of Americans has to do with their credit. Banks and other financial institutions have basically set up a fiscal lock-down, refusing to give out loans in most cases and reducing the flexibility of spending for most Americans. Even those with good credit are finding it tough to secure the loans they need to make big purchases. Furthermore, credit card companies are being pinched as well, by delinquent payments.

Because of the scarcity of loans and financing options available on the market, it's very important to keep good credit or to build towards it now. As a cardholder, the one thing you want to focus on is preventing your credit card from accruing debt. It's difficult these days, but it's possible, and there are several ways in which you can go about ensuring that your credit stays clean or gets on the path to recovery.

The first thing you should do is verify that your credit card has the same terms that were given to you originally when you first obtained it. Sometimes, issuers like to change things such as shortening the grace period or increasing the interest rate based on the way in which you utilize your card. Even if you don't use your card often, this can happen. A card that doesn't generate much revenue can have some penalties imposed such as higher fees for late payments.

Another thing you should strive to achieve is paying your balance in full every month. Don't revolve a balance simply because you can; this is atypical behavior that will raise a red flag with your credit card issuer, who could then turn around and lower your credit score as a result. Basically, if you can afford to pay your balance in full, you should continue to do so.

It may sound obvious, but always pay your balance on time. This goes a long way towards making you a low-risk borrower. Furthermore, keep your balance low from month to month. If you charge significantly more than what you typically use, then this kind of behavior can catch the attention of your card company in a negative way. You want to stay 'under the radar' so to speak with your card issuer in order to avoid their scrutinizing glare, because they can always change your card terms for the worse based on the way you use your card.

Last but not least, don't neglect to check your credit report. It's free with the right sources, and it can point you towards understanding your credit in its entirety and to see ways in which you can improve it. This is fundamental to achieving a good credit score that can reflect on the terms of your credit card, such as the balance limit and interest rate.