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Dodging through the Hazards and Ensuring YOU Have the Right Deal

A credit card can be amongst the most important tools you'll ever have at your disposal. By offering you easy, flexible and sometimes relatively cheap spending power it can be used to spread the costs of home essentials, the occasional luxury, or sometimes just to plug the gap ahead of pay day. Used incorrectly, however, and it can lead to a stream of debt problems that can take over your life.

Common sense is the most important ingredient when dealing with financial products. Apply this and a little restraint and you should be okay. Nevertheless, the multitude of advice on offer can be overwhelming. Who, exactly, do you listen to? To simplify matters, and make it easier for you to get the best deal possible, we*ve compiled our top ten tips for steering past the hazards and ensuring YOU have the right credit card deal.

1) The first and most important thing to understand before you even consider any financial product * particularly a credit card * is this: You must have income sufficient to pay your current bills and overheads PLUS any new financial undertaking. Don*t be taken in by the polished words of a lender's marketing literature: it's an assessment only you can make.

2) Be smart and be cautious. If only credit cards with a high rate of interest are available to you, don*t go mad with spending on them. Use them for small purchases and pay off the balance in full at the end of every month. That way you minimize interest payments, but also * by paying back in a timely manner * you prove your worth as a lender and boost your credit rating. This will enable you to get lower APR on future credit card deals, and boost the chances of larger credit lines being made available, such as auto loans and mortgages.

3) The very nature of borrowing means that interest increases over time and if it isn*t dealt with promptly, it can spiral out of control and land you in trouble. Particularly with credit cards, when interest payments are large, and a minimum payment offers a seemingly manageable solution it can lead to unmanageable debts if not attacked properly. What actually happens if you just pay the minimum payment is this: the balance is barely eroded and might take many years and many dollars in interest rates to disappear. You need to adopt a radical approach, where chunks of debt are eaten away each month.

4) If you have a large outstanding balance, don*t just let it sit there attracting large interest charges. Consider a credit card balance transfer to a lender offering a lower rate of APR. This will mean you spend less on interest payments each month and start to attack the overall balance with real venom.

5) A large balance and no immediate prospect of paying it off can be a nightmare. Don*t just pay the minimum payment each month * this is playing into the hands of the credit card company. Consider taking out an unsecured loan as a way of consolidating your debt. Personal loans can give you a consistent cheap debt, and as you must make the repayments each month, it helps provide structure to your repayments. Those with poorer credit scores might not always get the best rates, but it's still often a cheaper option than paying back credit card debt each month, and even in the long term a faster method of repayment.

6) If you feel you might be in trouble with credit card borrowings, don*t feel stigmatized by your debt woes and don*t bury your head in the sand. Help is at hand should you seek it, and a solution is never far away.

7) If you have a poor credit record, the sad fact is that you*re most vulnerable from the unscrupulous machinations of rip-off lenders. Be wary of "special deals" touted for credit cards for borrowers with poor or no credit history, especially if they're being offered by small-time lenders. Poor credit deals often involve inflated interest rates and onerous repayment terms.

8) If you have a large outstanding balance, but money in the bank * use your cash! It might sound obvious, but the interest paid on savings is usually far less than interest charged on borrowing, so paying off debts with savings makes plenty of sense.

9) There's a vast array of different cards on the market * not just credit cards. ATM cards, charge cards, even different types of credit cards can be confusing to many consumers. Make certain you know what you*re letting yourself in for before applying. The wrong financial product can be a costly mistake.

10) Remember: If it sounds too good to be true, it most likely is.

So long as you*re sensible, however, there should be nothing to worry about. If you*re aware of some of the pitfalls