Plastic money has become an essential part of our lives, especially after demonetization. It helps you move around anywhere without hesitation. It is that best friend who comes to the rescue instantly at the time of the cash crunch. The extensive benefits associated with the credit cards enrich every shopping experience
of the customer. Though some people still feel reluctant to own a credit card because they believe they will end up overspending. Plus they will have to provide additional interest. But some lesser-known hacks can help you make better and smart utilization of your credit card.
Smart Credit Card Usage Hacks
1 – Save By Using The Right Credit Card
Picking up the credit card that matches your purchasing behavior is the key to save more. For example, if you are accountable for paying your electricity bills, telephone bills, gas bills and enjoy going for movies regularly, you should go for cards that will provide you at least 5% cashback every time you make these transactions. Therefore you can save up to Rs. 1000 to Rs. 1500 every month, which is a neat saving of Rs. 15,000 to Rs. 18,000 in a year.
If you are a traveler who spends a major part of the day traveling, then you should go for a credit card that will provide you with four reward points for every Rs. 150 spent on fuel. Some reward points are given all the time for shopping. Other cards also offer travel insurance, dining privileges, and several lifestyle benefits.
2 – Maintain A Good Credit Score
Credit score plays a significant role for those who are willing to borrow finance from the banks. It shows the creditworthiness of the customer. Therefore for those who are planning to own a house or a piece of land or even willing to take a personal loan should take their first step towards improving their credit score. Therefore you can make regular withdrawals from your credit card and pay all dues on time. A good credit score for a constant six months will open all the gates for and make the path smoother.
Banks issue a credit card with lesser benefits to the people with a lower credit score. They upgrade your card for more benefits only in case of a sound credit card. Hence, a good credit score means extra benefits and more savings.
3 – Extend Payment Time
You can definitely go conveniently cashless with a credit card. But you must always keep a check on your billing cycle. Suppose your billing date is the 11th of the month. All the transactions you have made prior to, say 11th January, will be billed on 11th February. However, if you are not in the mood to pay your bills in the coming month, try to plan your purchases after 12th January. This will extend your payment time and defer your payments.
4 – Make Big Off Purchases On Emis
One always tries to buy a big purchase at least once a year. It takes a lot of money to purchase assets like a car, an apartment, gold ornaments, or even if you are planning a fancy holiday. Therefore, rather than losing over all your savings at once, it is better to obtain a credit card that does not charge additional interest on purchases and provide an extended period of repayment. At the same time, you can save a decent percentage by keeping all the money on a savings account or investing it in other marketing instruments. And, use the earned interest to pay off the EMIs.The trick here is to select the minimum EMI amount each month and clear off all debts on time.
5 – Beware Of All Kinds Of Debts
Usually, the customers avoid reading the terms and conditions at the time of applying for the credit card. It results in missing out on many facts and figures. The rate of interest varies according to the type of credit card. While making a monthly payment, the lender first applies the payment to the cheapest debt and keeps the heavy payment debts for future payment. They try to make a profit by charging as much as they can on the debt. Therefore you should always pay your expensive debt first and save some money spent on interest. Otherwise, the interest will keep rising.
6 – Never Miss Redeeming Rewards
Most credit cards offer reward points which is like a steal deal for credit card users. Shop from the sellers who are in partnership with the credit card and earn as much as reward points and redeem it at the right place. You have all the right to seek full benefits out of every purchase.
Credit card users will keep growing day by day. It is crucial to know how to use it smartly. It can not only manage but also can reduce your debt. But it is important not to end up spending excess in excitement.