Use Your Credit Card For Your Advantage

best credit card


A credit card has become one of the most used financial tools. It is important for people to know how to use credit card benefits. If we individuals use their cards wisely, they can work for you and not against you. If cardholders don’t keep a check on the amount of card debt, it would create huge problems for the growing and developing the economy. According to the most recent statistics, an average Indian household carries approximately 6.74 lakh crore in credit card debt. This figure tends to increase every next year. There are several ways that can help people use their credit cards judiciously. 


  • Regular repayment of the outstanding amount: paying the bill on time is a major concern for all cardholders. They should indulge in regular repayments for avoiding delayed charges and interest on the outstanding amount. Regular repayment also improves the CIBIL score of the individual, which usually helps in credit taking capacity of the person.

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  • Pay the amount in full: Except the EMIs, the cardholder should pay the amount in full, he/she cannot pay half amount at a point of time and pay the other half at some other point of time. Paying in installments is not accepted by the banks because the installments carry interest, penalties, fees, or other such charges which are applicable.
  • Paper trail: Credit card spending is easy to track because of the paper trail. Individuals need not keep safe all the receipts as he can log into the account and check the payment done through credit cards at various stores, malls, and shops.
  • Use a credit card as a complement to your budget: The credit card should not be a part of your budget, not even the first source of funds for the cardholder; it should be a compliment to the budget i.e., expenses over and above the budget.
  • Know your limits: Overspending is a major concern for all the cardholders. Unless and until they know as to how much to spend, what is their limit to spend, they won’t be able to take advantage of the credit card services. Sometimes credit cards have self-imposed limits as well so that individuals are aware of their spending.
  • The card should be used for expensive stuff: cardholders cannot use the card for daily necessities or inexpensive stuff because that can cause delayed spending of the consumption. Save up the expenses for consumption first and then use the card if there is a need to. For expensive things, people are not able to pay the amount in a lump sum; thus, they prefer to pay it through credit card and get the amount transferred into EMIs. People prefer to pay the amount with interest rather than paying the whole amount altogether.
  • Reward points: credit card offers various benefits in the form of reward points, and they should be used or redeemed by the people to get maximum benefits on using the card. For example, usually, INR 4 is equivalent to 1 reward point. These can be used to purchase stuff from retail stores or online stores for free or at a discounted price.

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Card with less annual fees and extra perquisites should be preferred: several credit cards offer huge benefits without charging huge annual fees; thus, customers should take advantage of the same and keep an eye on such cards. Various credit cards have an annual fee as well as renewal fees of less than INR 500. The individuals can target such credit cards.

READ ALSO: Applying For a Credit Card- Key Points to Remember