Credit card runs on the principle of “Buy Now and Pay Later.” Credit card is a best option that grants you a line of credit for a good time period. The two most prominent credit cards available in the market are Visa and MasterCard. It is really very easy to use credit card for paying shopping bills and many other bills but it is really very significant for a user to know how to be smart with your credit card.
Following Are The Tips To Help To Use Your Credit Card Wisely
Know Terms And Conditions
Before applying for a credit card it is important for you to read out its terms and conditions wisely. You will sign up a legal contract with a particular bank when you select a credit card for you, so it is really very important for you to understand terms and conditions and features of credit cards like interest rates and fees in a proper way.
Don’t Go for Impulse Buying
It is not necessary to purchase things right away even if you don’t need it at the moment. If you get the time to pay off the money that doesn’t mean you go for impulse shopping as it may further lead to debt if you fail to pay off money later on due to some unknown reason.
Don’t Use Your Credit Card for Small Purchases
It is better to avoid using your credit card for each and every purchase. Items like grocery, food and gas bill payment can be easily avoided through credit card. Addiction of anything could be wrong in every aspect.
Know Your Due Date and Make Payment in Full in Due Date Every Month
It is important for you to remember your bill payment dates for all your credit cards and you should always make sure to make payment in full in due date every month. If you exceed your payment tenure then it may lead of paying additional interest rate or late fee charge.
Avoid Extra Interest Charge
If you have bought a TV using your credit card and have decided to make payments in small EMI for 9 to 12 month, then you will have to pay interest charges for that particular time period. Actual cost of TV along with interest charges will make you pay almost twice the actual price of TV. So, think twice before making any purchase.
Have Control on Your Spending Habits
You must avoid increasing your spending habits just for the sake of getting credit card points. It may indulge it the trap of debts.
Check Your Credit Card Statements Carefully
It is important to tally your credit card statement every month carefully to make sure it is completely error-free. Keep a track of all receipts so that you can compare it your credit card statement.
Make Payments Regularly to Build Good Credit History
Paying balance in full every month help you to build a good credit history and to get a decent credit score. A good credit score will increase the possibility to get a loan at a lower interest rate.
Stop Using Credit Card if Your Monthly Balance is Getting High
You should keep in mind to stop using credit card if your monthly budget is getting out of balance. Instead try to use cash more to pay for day to day expenses. Once your budget is back in track then only you must start using your credit card again.