Navigating credit cards: Missoula bank president shares tips to build good credit

MONTANA - NonStop Local is launching a special series, "Battling Broke," to provide practical financial advice, starting with tips on credit cards.

Bob Burns, president of Stockman Bank, shared insights to help demystify credit card myths. 

One common misconception is that carrying a credit card balance month-to-month can build your credit score.

"The important piece of that is being responsible with your credit card, or credit cards if you have multiple. And not carrying balances month over month and paying the interest expense. You pay it off in full every month, and that will build your credit score," Burns stated.

Another myth suggests that never closing a credit card is always beneficial. While closing a card can affect your credit score, responsible credit use is key. 

"The better approach is using your credit cards responsibly, paying them off every month, and not carrying a number of credit cards that carry balances with that high interest expense," Burns advised.

Burns also addressed the myth that recovering from a bad credit score is impossible. 

"It might take you a period of time to recover from negative credit, or credit that's been impacted by misuse of credit cards at that point. But it is something that you can recover from if you focus," Burns said.

Understanding credit card rewards and points systems is crucial. Burns emphasized, "You just need to really pay attention to what those rewards are, what are the annual fees on those cards, and make sure the benefits outweigh the costs of having that card."

And finally, Burns recommends seeking advice directly from financial institutions over relying on social media. "That face to face conversation can be light-years better than advice you might find on social media," he said.