by beconrad

Did you know that credit card companies have a special name for that subset of consumer who always pays his or her bill in full every month? It is true — they call those people deadbeats. That is because while the credit card issuer still profits from the transaction fees paid by merchants, they derive no income from the cardholders themselves.

If all credit card holders fell into this category, the entire credit card industry might well collapse, although with record levels of consumer debt on the horizon it seems unlikely this will happen. So there is no reason for you to feel sorry for the credit card companies. Becoming a deadbeat in their eyes can be good for your personal bottom line and your credit score.

Plastic Cash

Many people have trouble using credit cards responsibly simply because those cards are so convenient and easy to use. When buying what you want and need is as simple as swiping your card and signing your name, it is easy to see why so many people are tempted into spending more than they can afford to pay off at the end of the month.

One of the best ways to break this habit and get yourself into the dreaded deadbeat category is to treat your credit card as just another form of cash. Using your credit card for everyday purchases makes sense, especially if you carry a reward card that offers cash back, gift certificates, discounts and other perks. The key is to view the credit card not as free money but as just another form of cash.

Before you make a purchase, ask yourself whether you truly need the item. If the answer is yes, check your wallet and your checkbook and make sure you have enough to make the purchase. Then pull out your plastic, make the purchase and rack up those reward points. As long as you pay off your bill at the end of the month, those reward points are just like free money.

Track Your Spending Online

One of the dangers of credit cards, and one of the primary reasons credit card issuers have so few so-called deadbeats, is that it is easy to lose track of how much you are spending from month to month. While you might remember the big charges, those little charges can add up significantly, often running the bill past the point where you can pay it off.

One of the best ways to gauge your spending and make sure you are still on track to pay off your balance each month is to check your balance online at least once a month. Checking your account online accomplishes a couple of important goals. For one thing, it helps you track your spending and identify wasteful habits that could be costing you money. In addition, checking your statement regularly gives you an early warning about fraudulent or unauthorized charges on your account. Since an unauthorized charge or a bill from a merchant you do not recognize could be signs of identity theft, the sooner you report the problem to the card issuer the better off you will be.

By becoming a wise consumer and learning how to use your credit cards the right way, you too can become a deadbeat. The credit card company might lose some affection for you, but your wallet will thank you.