best credit cards

5 Ways to Use your Credit Card Smartly!

A large number of people seem to be in love with online credit cards. Credit cards used to be the prime possessions of a selected people, but the trend has changed the way people have embraced credit cards in their lives recently. Why? It’s because a credit card provides absolute liberty when it comes to using it for many needs is safer than cash.

The working concept of a credit card is simple – you can buy now and pay later – to sort your existing financial crunch. Nowadays best credit cards also come with heaps of rewards to work in your favor further.

Although credit cards are rewarding, you can utilize its maximum advantage only after you use it smartly! Let’s provide you some handy tips to use your credit cards prudently.

  1. Ask for a higher credit limit

If you are all set to apply for an online credit card, try to ask for a higher credit limit. Why? Other than giving you a higher amount to utilize for your needs, it also affects and improves the Credit Score. Low usage of a higher spending limit also exhibits a dearth of credit hungriness which positively contributes to your CIBIL Score.

  1. Always pay your credit card outstanding on time

While it is a known fact – a majority of borrowers tend to ignore it and face negative consequences. Nonpayment of the outstanding amount can mount a higher interest rate, and you must ensure to pay the bills on time or pay heavily later. To avoid paying interest and to avoid affecting the Credit Score negatively, pay the EMIs or outstanding amount on time.

  1. Don’t pay the ‘minimum amount due’

While your credit card will have two types of payments once your bill generates – one is the ‘total amount due’ and another being ‘minimum amount due.’ You can easily decide to pay either of the two while choosing to pay credit card outstanding. However, you need to know that paying the ‘minimum amount due’ should be last resort if you don’t have funds for the month! Its fine to pay it once or twice, but you should not make it a habit because your bank may charge you a penalty. What’s more, you may also have to pay interest heavy bills if you keep paying the ‘minimum amount due’ and don’t pay ‘full amount due.’ Thus, don’t give attention to the minimum dues; ensure to clear your entire amount due every month without fail. Do this if you are not looking to land in a situation where you are unable to clear your debt in years.

  1. Don’t give into the temptation of withdrawing cash with credit cards

Yes, leading financial lenders offer you a fixed or floating ATM cash withdrawal limit on your online credit card. However, you should it make it a point never to use it for cash withdrawals and attract heavy charges. Are you willing to pay extra charges for withdrawing some money from an ATM? Certainly, you need not!

  1. Use your credit card to avail a loan if you must

Did you know that major banks and non-banking finance companies (NBFCs) let you avail a loan against your online credit cards? Yes, that’s possible! All that you need to do is – ask your credit card issuing company for the same!

The Bottom Line

Credit cards are indeed a vital financial instrument if you know how to use only in need, and never for luxury! If you are looking to apply for the best credit cards, you can apply online, and incorporate the discussed points to maximize its full potential! Good luck!

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