Credit cards can be a useful financial tool in a number of ways. Aside from the purchasing power they provide, most credit cards come with beneficial rewards, and responsible credit card usage can help build and improve your credit. However, the key word in that statement is responsible, and improper credit card use can put you into a financial hole that is hard to escape.

In this way, credit cards are like fire– their usage can have a number of meaningful benefits, but irresponsible or careless use can create serious damage. According to recent research published by NerdWallet, consumers in America owe a total of $784 billion in credit card debt. The average American household with credit card debt owes balances totalling at $16,883, and this costs them approximately $1,300 per year in interest.

This is not meant to discourage responsible consumers from utilizing credit cards, but irresponsible credit card use can build excessive debt, damage your credit score and create a vicious cycle that is hard to escape.

This article is designed to help educate those who are new to credit cards, those who have already dealt with credit card debt or anyone who simply wants to learn better habits. Using these strategies and using your credit cards properly can greatly improve your credit score, reduce the stress of debt and give you more financial freedom and stability.

1. Remember they are credit cards

This means that you are essentially borrowing money every time you use your credit cards. They are not magic wands that give you free money, and everything you spend will have to be paid back with interest. Trying to think of every credit card purchase as borrowing money will help you be more cautious with your spending.

2. Only spend what you can afford

Just because your credit card has a certain limit does not mean that you have to use that much. In fact, if you use your cards responsibly, you should never have to think of your credit limit, as it will have no impact on how much you spend.

Your credit card expenditure should depend solely on how much you can afford to pay back when the bill comes, and you don’t even have to spend that much. A general rule of thumb is to keep your credit card balances less than 10% of your monthly income.

3. Use your money first

Many people make purchases using credit cards before using cash or debit cards, but this can be a mistake that creates bad habits and leads to more mistakes. Especially if you are inexperienced with credit cards, it is best to use the money you actually have before dipping into credit. A simple rule is to use cash or debit on everyday expenses and only use credit cards on large or irregular purchases.

4. Find the right card for you

Credit card rewards can be one of the most useful, beneficial aspects of the cards, and you should use them to your advantage. The first step is to find the right card– with the right rewards– for you.

If you travel a lot, use cards with hotel and airline rewards; if you are a college student, get a student card that rewards you with electronics and useful gift cards. There is a credit card for any interest, vocation and person out there, and sites like offers.creditcard can help you identify the right one for you.

5. Ignore the minimum payment amount

You should pay as much of your credit card balance as possible, and it is best to pay it in full each month. Paying the minimum may seem like it is temporarily helpful, but this will quickly rack up loads of interest. This should go without saying, but you also need to pay your bills on time.

Carefully budgeting and determining how much you can afford to spend ahead of time will greatly influence and benefit your credit card spending. Spend your cash first on regular expenses, find the right card for you, spend only what you can afford and pay your balances on time to experience all the benefits of responsible credit card use.