DO

Choose the right card
Choosing the right credit card could save you thousands, and even make money. If you always pay off your balance, opt for a card that rewards spending with frequent flyer points or vouchers. Then, set up direct debit payments from your credit card for regular expenses, like rent, and watch the rewards roll in. If you're not a prompt payer, choosea no-frills, low-rate card or a debit card.

DON'T

Use your card without thinking
For purchases of several thousand dollars, like furniture, don't automatically whip out your credit card. If you don't have the funds to be able to pay off the debt within a month, consider a personal loan, which generally offers a lower interest rate.

DON'T

Be wary of banks encouraging you to extend your card limit or sign up for more cards, which increases their interest-earning power. Also, be careful of instore credit cards, which can charge high interest rates. "To really get the benefits of reward programs, you'll [often] need to spend at least $10,000 with one retailer group," warns Frank Lopez, of financial product researchers Canstar Cannex.

DO

Know the fees
Nearly half of all Australians don't know the interest rate on their credit cards, which is concerning, says Allison Tait, author of Credit Card Stressbusters (Wrightbooks, $24.95). With interest rates ranging from 8.89 per cent to 20.74 per cent, you could be paying more than double the interest you should be. Tait advises that you check other costs, such as increasing annual fees, payment history surcharges and late fees, and take them into consideration when choosing a card.

DO

Check your statements
One third of Australian women don't read every bank statement they receive* - which is a big no-no, says Judy Shaw of Visa. "Check your card statements promptly. Look at all transactions, even the small ones, because criminals sometimes test out accounts by buying inexpensive items first. If you discover something suspicious, report it immediately."

*Financial Literacy Foundation, Financial Literacy - Women Understanding Money, 2007. *Age Concern, 2008.