Check Out the Best Credit Card Advice you Need to Follow
A credit card can be a suitable financial tool when used responsibly. Most people enjoy the conveniences and benefits of credit cards for various reasons like:
- To overcome short-term monetary crunch
- Instant financing
- To get reward points and discounts, etc.
People tend to apply for best credit card in accordance with their personal obligations. However, if spending gets out of control, the purpose of this card becomes a complete wastage. To get the most of it, one needs to follow certain advices encompassing the time of application to proper usage.
Following listed are the top credit card advices one needs to consider for a credit card.
At the time of application
Multiple financial institutions are existing in the market offering credit cards. However, one should look out for a checklist before submitting the application or choosing the best credit card:
- Interest rate –
Interest rates are charged on an issued card only when a user fails to pay off the bill within the due date, every month. So, an individual must check and compare the rates by various lenders to choose the most affordable one. Moreover, one should also take account of related fees, charges and incentives.
Many prominent NBFCs bring in the best facilities. For example, Bajaj Finserv RBL Bank SuperCard comes with nominal processing fees and several industry-first features for consumers’ maximum benefit. They are:
- Instant cash withdrawal from ATMs with no interest up to 50 days
- Availability of emergency personal loan with 0% interest up to 90 days
- Easy EMI options
Moreover, this leading NBFC comes with customized pre-approved offers on credit cards, personal loans, business loans, home loans and a host of financial services/products. Such offers make the finance availing process hassle-free, thereby, saving a lot of time.
One can check one’s pre-approved offer any time by filling the required details online.
- Credit score –
A CIBIL score of at least 750 is necessary for availing the best credit card with attractive features like welcome bonuses, reward points, milestone bonuses, etc.
- Check eligibility –
Lenders look for some of the essential eligibility qualities like age, job stability, & income proof before approval. Furthermore, they typically ask for a few necessary documents to give the final nod. Keeping these handy usually leads to prompt approval.
Tips to use credit cards mindfully
Now comes the most critical part because every credit card transaction matters. Here are a few smart ways one can follow to maximize these cards’ advantages.
- Payment on time & in full
Timely credit card payment offers a minimum of 35% in one’s CIBIL score. So, it is vital to pay the outstanding balances within the grace period per month. The credit score takes a hit for every late payment.
Although going for the minimum amount due is convenient if a user fails to pay the entire amount, clearing the total due is always a safe bet. Or else, their CIBIL rating may take a hit.
- Monitor debt-to-credit ratio
Debt-to-credit ratio is also referred to as credit utilization ratio, and it is one of the significant factors to compute credit scores. Reducing monthly recurring debts can lower one’s credit utilization ratio. One must keep this ratio within 30-40% because lower the debt, easier it is to maintain an excellent CIBIL score.
- Stay committed to a long term
A longer and sound credit history is preferable as it determines a borrower’s stable repayment capability. So, a user should not close a credit card with a long history as it may hurt his/her score by increasing debt-to-income ratio.
- Check the account frequently
Reviewing the latest account activity is fundamental to credit card & its safety. People often fall victim to fraudulency. So, pay heed to every transaction, check details online at regular intervals to avoid any unwanted situation.
To sum up, a credit card must be used as a budgeting tool. Reckless purchases can lead to significant debt with further consequences. A user has control over how his/her credit develops over time. And, following the advice mentioned above can largely help them with maximum financial stability using their credit card.
Author Bio:
Gaurav khanna is an experienced financial advisor, digital marketer and writer who is well known for his ability to predict market trends. You can find Gaurav on Linkedin.
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Category: Credit Cards
