Best moves for credit card users in 2007

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Debit card usage surpassed that of credit cards in 2006 as the industry continues to promote new card programs.

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Best moves for credit card users in 2007

By Ellen Cannon • Bankrate.com

Paying them off is, for sure, the best thing you can do with credit cards in 2007, but in addition to the obvious, there are some other good moves to make.

Here are some other good moves to make:

•	You're entitled to a free credit report annually from each of the credit reporting agencies. In January get one from, say, Experian; in May from Equifax, and in September from TransUnion. By staggering your requests, you will be able to follow the activity on your credit reports year-round. That way you can make sure no inaccuracies creep onto your report and simultaneously make sure no one is swiping your identity.
•	Consider getting a fixed-rate credit card. With the Federal Reserve holding interest rates steady for the past few months, credit card companies are holding theirs, too. Now is a good time to research fixed-rate cards and find the best one for you.
•	An October 2006 study by the TowerGroup, a consulting firm that covers the credit card industry, predicts 90 percent of cardholders will have a rewards card within five years. But that same study says that banks are re-evaluating the costs and benefits of their rewards programs. Nevertheless, many credit card issuers have introduced new rewards programs this year. For example, Chase has introduced its "Freedom" card that allows cardholders to switch back and forth between cash-back and points programs. And points are earned at everyday shopping places such as gas stations, grocery stores and quick-service stores. MasterCard, Visa and American Express have each launched new reward programs that offer concierge service and access to special events. If these programs become too costly for the banks to continue, however, they may be scaled back. Now is the time to take a look at the new reward programs and see if there's a better one for you. Before you drop your current card for a new one, though, be sure you make the switch without damaging your credit rating.
•	The fact that debit card use is outpacing credit card use may be a sign that Americans are getting a grip on their trillion-dollar credit card debt. In 2007, make a plan to start paying down your debt. Begin by using Bankrate.com's calculator to learn how long it will take to pay off your credit card. Then turn to the Debt Management section of Bankrate.com, which is filled with tools and articles to help guide you through the process of getting out of debt.