How to protect your credit card from emergencies

By Tim Sullivan

When a costly emergency strikes, is your first instinct to pull out your credit card? If so, you may want to consider the benefits of building an emergency fund.

Creating an emergency fund is a vital step toward becoming a responsible credit card user. A credit card can be the perfect tool for many financial situations, but confronting large, unanticipated expenses isn't one of them. Even if your interest rate is low, monthly interest charges can still add up quickly. But a well-stocked emergency fund can prevent the need to go into debt when sudden events force you to reach for your wallet.

What is an emergency fund?

An emergency fund consists of easily accessible assets set aside -- typically in a bank account separate from your normal funds -- to be used only in the case of an emergency. It's not for movie tickets, vacations or video games. It's only for vital, unforeseeable expenses that are not part of your normal monthly budget.

What counts as an emergency?

Simply put, it's any unexpected, essential expense that your budget can't handle. Whether it's a sudden job loss or an accident that injures you or a member of your family, your emergency fund is there to help you cope with difficult times.

By Jennifer Gregory

As I scribbled down my New Year's resolutions for 2013, I realized that my list looked a lot like those of previous years, filled with vague goals about exercising and organizing my home. It hit me that I had never actually made any resolutions specific to my finances. So I decided to make this year's list a little different.

Here are four things I resolve to do with my credit cards in 2013.

1. Research card options throughout the year

Like many consumers, I tend to get complacent and use the same credit cards without re-evaluating whether my current cards suit my situation. Issuers release new credit cards throughout the year, many featuring 0 percent offers, and new promotions on existing cards appear too, such as the seasonal bonus offers on my airline credit card. But while I've planned to compare cards in the past, the task has stayed at the bottom of my to-do list.

This year, I plan to spend a few minutes on the first Monday of each month researching credit card options to see if I need to rotate the cards in my wallet.

By MoneyBlueBook

Much is said in personal finance about the cost of a daily cup of coffee. But can foregoing your morning latte really improve your financial situation?

This MoneyBlueBook.com infographic breaks down the cost of your caffeine habit -- and the potential benefit of dropping it.

Click on the image below to see the full graphic.

By Julie Bawden-Davis

When a credit card company says they'll give me free credit for 12 months, I consider paying off my balance before the end of the period -- and avoiding the interest charges that will appear if I don't -- a challenge.

My romance with these offers started several years ago when the receptionist for my son's orthodontist flashed me a toothy grin and handed me the bill for his braces. I gulped at the total and decided to apply for a card that offered a zero-interest period to help handle the expenses. I paid that balance off before the end of the period, and I've since financed several dental and veterinary bills the same way.

But before you opt to use a 0 percent offer to pay down your bills, here are five tips to keep in mind ...

By Tim Sullivan

I'm lucky. I had older siblings who made mistakes with credit cards before I was old enough to get one. As a result, I got to learn from their financial slip-ups. But since some initial hiccups in college, all of us now have control of our credit.

We sat down to dinner recently and I asked them for five credit card habits they wish they had mastered earlier. Here's what they came up with:

1. Paying your balance in full every month

This should always be your first and foremost goal with your credit card. Effective credit card users don't carry a balance from month to month ...

By Marc Pearlman

A sad truth today is that many Americans don't have enough personal savings to enable a worry-free retirement. But a common misconception among people who are struggling financially is that in order to get ahead, they must earn more income.

While more income is one solution to this problem, it's not the only solution. Furthermore, many working adults are living paycheck-to-paycheck, regardless of income. This suggests that the problem may often be more related than spending than income.

Fortunately, you don't need a financial planner to implement a strategy that can dramatically impact your future financial freedom. I call this strategy the 10 percent solution and here is how it works ...