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Credit card has become an essential financial instrument today, but if not used properly, it can also become a financial burden. Therefore, it is important to keep some important things in mind while using it. If you are getting a new credit card or using an existing card, first understand your budget and spending pattern. If necessary, read the most important terms and conditions on the bank’s website or app. Come, here are the do’s and don’ts in using credit cards, so that you can avoid getting trapped in the whirlpool of debt.
What to do
- Choose a card as per your need: Choose a credit card that suits your lifestyle and spending habits.
- Check the statement every month: Check the monthly statement of your credit card carefully, so that any wrong transaction can be detected in time.
- Pay full bill on time: Always pay full bill on time to avoid interest.
- Spend within the budget: Spend as per your income, so that debt can be avoided.
- Take advantage of the interest-free period: By making payments during this period, you can avoid paying additional interest.
- Keep an eye on reward points: Keep an eye on the validity of your reward points, so that you can take full advantage of them.
what not to do
- Don’t just pay the minimum amount: Doing so may result in hefty interest charges on the remaining amount.
- Do not exceed the credit limit repeatedly: This can damage your credit profile.
- Do not delay bill payment: Late payment increases both penalty and interest.
- Avoid closing old cards: This can affect your credit score.
- Don’t apply for multiple cards at once: This has a negative impact on your credit worthiness.
- Avoid withdrawing cash: Withdrawal of cash from credit card is costly as interest starts accruing immediately.