building credit questions..

[zixxer]

I just got a secured card through bank of america.. I put $500 into a savings account that's locked down for a year.



My question is this: The woman that setup my account told me that I have to keep a balance until I owe interest on it.. I ask her to further explain and she said that she didn't "exactly" know, but that was the idea.


So.. how "exactly" does it work?? I was thinking I would use it only for gas; that way I don't risk being unable to pay an outrageous balance or something.. Do I wait 30 days and pay it then?

 

[Vic]

She's wrong. You don't have to keep a balance and pay interest, you can just pay it off in full every month when it's due if you want to (and I would recommend).
That you have to keep a balance and pay interest is a common myth about credit cards and it is entirely untrue. Every time you make a payment on a credit account, the creditor is obliged to report the payment to the credit bureaus. Every time you make a satisfactory and timely payment, it improves your credit history (and score). Simple as that. They can't knock down your credit just because you don't give them a couple dollars in interest.