5 Credit Card Tips That Will Make You a Smart User

5  credit card tips that will make you a smart user

Credit cards, when utilized cautiously can be a useful money-related tool. You can improve your credit ratings by making customary regularly scheduled instalments of the whole outstanding bill. Then again, allowing your credit card spending to wind crazy will antagonistically influence your finances and credit ratings.

Here are a few tips to make intelligent use of your credit cards:

1. Address your needs, not wants.

Use the credit card as a short loan to yourself, and then pay back the amount as soon as possible so that you can avoid interest charges. Having to pay off the mobile phone bill before your payday is a good example of a need. Frivolous purchases, which are not essential for your life can be considered as wants.

1. Use the credit card as a budgeting tool.

If you are clear about using the credit cards only for necessities, then you can try using it as a budgeting tool. By making all of your transactions with your credit card, you can monitor your spending and how much you’ve spent at the end of the month. However, you should make sure your credit card spending is in limit.

1. Pay off your balance every month.

You can use your credit card as a budgeting tool only if you pay off your entire outstanding balance every month. Paying off the total due every month can help you reap the benefits of using a credit card without attracting any interest charges.

1. Auto Debit.

There is no use of spending prudently if you forget to pay your bills on time. It is a beneficial practice to opt for auto debit. Once you set up auto debit instructions on your savings account, your credit card bill will be taken care of automatically.

1. Get EMI friendly.

With a Credit Card, you can buy big-ticket items in one swipe and then break up the sum into EMIs. Buying things on EMI is beneficial for your finances. Repaying your EMIs on time helps foster your Credit Score. Moreover, paying in EMIs for goods and items you need enables you to maintain liquidity. It will save you the pain of undergoing a cash crunch. After all, you need money to pay for your investments and daily expenses.