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6 Credit Card Tips For Smart Users

6 Credit Card Tips For Smart Users 

Compare Credit cards: Credit cards can be of great help in managing your finances. Avail a credit card, which is quite easy since many banks and NBFCs offer credit cards with great offers, use the card to make your payments and pay back the dues timely. As helpful as a credit card may seem, you can end up in a financial crisis, if you do not use the credit card responsibly. Reckless card use, failure in returning the credit and so on can damage your creditworthiness. Hence, if you are thinking of applying for a new credit card or if you already are a credit card holder, here are a few tips for you to use your credit card smartly!

Never miss credit card payments

One thing that any credit borrowers must never miss is the repayment. Any default in your credit card bill payment will get recorded in your credit history and will eventually affect your credit score badly. A lowe credit score works against your creditworthiness. By failing to repay for one card, you may damage your chances of getting the next one.

If you have multiple cards, you will need to be more careful as you will have multiple bills to pay. The best way to proceed is to pay off the credit card with the highest interest rates first.

Keep the card utilisation low

Every credit card comes with a credit limit. When you compare credit cards, credit limit plays a crucial role. A credit card with a high credit limit is alluring and it is natural to spend more, especially when you have a credit card with a high credit limit. However, a high credit card utilisation should always be avoided, as it impacts your credit score negatively. Moreover, if you fail to pay the credit bill of one month and it is carry forwarded to the next billing, you will wind up in a pile of interest. A credit utilisation ratio under 30% is ideal; however, never cross the 50% benchmark.

Look for reward cards

Most credit card providing companies nowadays, offer reward cards. These rewards cards basically generate reward points with your purchases. The reward points or offers can come as gift vouchers, tickets, airport lounges and so on. Some credit card companies allow you to redeem the points in cash. If you are using your credit card every now and then, look for rewards and offers when you compare credit card providing companies. 

Consider joining and renewal fees

Joining fees and renewals fees can make huge difference Suppose, you selected a credit card attracted by its low-interest rates and high credit limit, but you didn’t pay any attention to the high joining and renewal fees. In such a case, a big chunk of your money will go into the joining fees and renewal fees. Hence, you must be careful about the two stated fees. Select a credit card that comes with low or reasonable fees. Some credit card lenders offer a reversal fee when you cross a specific spending limit. The reversal fee can save some of your money.

Keep an eye on credit report

All credit card user must check credit report on a regular basis. Make sure to check the monthly statements. It will give an overview of your expenses so far and help you in further planning your finances. By keeping an eye on the statements, you can also spot any mistake or missed payments as well.

Spend on only needs

When you have a credit card in your wallet and do not have to pay in cash, it is easy to overspend. But this is something you must not do. It doesn’t mean that you will suppress your wishes and not get anything you want. It merely means not spending on things that are completely unnecessary. Hence, spend on needs and not only on desires!

Credit cards have made life easier on so many levels. They are easily accessible and convenient. Keep the above-said things in mind, check credit report regularly and you are good to go!

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