A: About 85 million Americans, or nearly 60 percent of all card users, carry a balance, according to recent industry estimates. Many end up paying thousands of dollars in interest they could have avoided with more self-discipline. Used properly, however, credit cards are not just convenient but also save you money. Although card reward programs have been scaled back, last year my wife, Georgina, and I still got more than $750 cash back on purchases we would have made anyway, most at the supermarket and drugstore. (Web sites such as www.CardWeb.com and www.Cardratings.com let you search for the best card deals). Rather than not use credit cards, I suggest: 1. Use just one card or two at most, not the four or five the average America cardholder carries (I have only two). But do not cancel unused cards right away. Doing so may lower your credit rating by making whatever amount you charge a higher percentage of your total available credit. 2. Sign up as I have to have the full balance on your card paid on the due date by electronic funds transfer from your checking account. This will be a powerful deterrent not to charge more than you can afford. 3. To make sure you have enough money in the bank on the due date, every time you charge a purchase, record the amount in your checking account checkbook. Q: While going to college, I am working for a small accounting firm and have saved as much as possible. I was hoping you could suggest where to invest my savings. I am not well-acquainted with stocks and bonds. A: There are many ways to start investing, and reputable financial advisers will come up with different recommendations. The one I like best: Build a simple portfolio of a few widely diversified, low-cost no-load mutual funds, and keep adding money to them. Among my favorite low-cost funds are index funds, which seek to match the performance of a market benchmark. For beginning investors, I prefer funds that track broad indexes, such as the entire U.S. stock or bond market, or a geographically diversified international stock index. Over the years, low-cost, broadly diversified index funds have outperformed most others. Leading no-load mutual fund companies such as Vanguard, Fidelity and T. Rowe Price offer low-cost funds with superior long-term records, including index funds. Their Web sites ( www.vanguard.com, www.fidelity.com and www.troweprice.com, respectively) provide excellent educational materials to help you build a simple but well-diversified portfolio. Q: We have used a financial planner for years. His annual fee based on the amount of money we invest is now several thousand dollars. Should we dump the planner and purchase index funds instead? We don’t have time to monitor our investments day to day. A: As much as I like index funds, it is not an either/or question between using them or a financial planner. Many fee-only planners (those who are paid a fee rather than commissions on products) use low-cost index funds for their clients’ portfolios. These planners’ job is to recommend and monitor the asset allocation, based on each client’s goals and risk tolerance. Also, besides offering investment advice, good planners help clients with a host of financial decisions, including budgeting and cash flow management, and tax, retirement and estate planning. And planners more than earn their keep when they help investors stick to a disciplined long-term plan during market declines. In addition to the Web sites mentioned earlier, index fund fans can get valuable information at www.indexfunds.com. Investors who prefer having an adviser can search among fee-only planners belonging to the National Association of Personal Financial Advisors ( www.napfa.org ). Humberto Cruz offers personal-finance advice. Write him at [email protected] local news?Sign up for the Localist and stay informed Something went wrong. Please try again.subscribeCongratulations! You’re all set! Checking reader mail: Q: Most people shouldn’t have credit cards. They allow you to spend money you don’t have. Supposedly they are good for emergencies, but what is an emergency? That plasma TV is on sale and you don’t have the money? About a year ago, I paid off all credit card debt and now use only a debit card. I am much more aware of how much I spend and think twice about unnecessary purchases. Before, I got in the expensive habit of carrying a balance.