Credit cards are an ideal way to cater to
urgent financial needs both personal and professional. You also get to enjoy
reward points, discounts, cashback, and several other offers that debit cards
don’t offer. To make the most out of your credit card make sure to study its
benefits and features before you apply.
You only have to know about a few things
before you apply for a credit card. Some of these are mentioned below:
1.
Interest rate- If you want to know how to use a credit card properly, you should understand how your
lender calculates the interest. No interest is applied to your credit until you
fail to repay your debt within the grace period. A grace period of 45 days is
given to you to pay the same. This grace period includes one month billing
period and is stretched to another 15 days after the arrival of your bill.
Thus, if you want to know how to reduce your credit card interest and save
money, make sure to pay your dues on time.
2.
Late payment fees- Paying your debts late will pull in
complications and increase your bill; however, there can be times when your
punctuality takes a backseat. While you apply for a credit card, make sure to
inquire about the late-payment fees. Also, avoiding late payment will help you
maintain a good CIBIL score.
3.
Reward points- Every time you use your credit card, rewards
in the form of reward points will be provided to you. Once you know how to use
a credit card properly, there are a lot of things to do with your credit card
reward points such as availing discounts on flight tickets, electronic devices,
mobile recharge, hotel bookings, etc.
4. Total amount due- The most important pointer on how to use a credit card is to pay the
total outstanding amount due on your credit card instead of the minimum amount
due as mentioned in the statement. If you are compelled to pay the minimum
amount instead, the difference between these two amounts will be added to your
next statement including interest. Paying the total outstanding will not only
help you avoid the interest but also increase your credit score with every such
payment you make.
5.
Annual fee- The annual rates vary from lender to lender.
However, always inquire about the yearly fee that your lender charges before
you apply for a credit card. Try to go for a lender who charges no annual
fees to reduce the burden of debt.
Several financial institutions and NBFCs
provide credit cards with other benefits such as signing-up bonuses, easy EMIs,
robust security, etc. Bajaj Finserv is such an NBFC that has introduced Bajaj
Finserv RBL Bank SuperCard which provide unique benefits such as emergency loan
availability, interest-free cash withdrawal from ATMs, instant approval with
minimal documentation, etc.
Make
sure to set your limit to avoid over-usage of your credit card. Also, do restrict yourself from using too
many credit cards at once. Using too many cards at the same time will result in
losing a track on your due amount and due date, which can make you default on
payments. Try to meet the total outstanding as per your monthly statements with
proper financial planning.
