When you enter the professional world, your income is less than what you want. In such a situation, you have to use money very carefully. At this time sometimes your salary ends before the end of the month. In this case, you use a credit card, but keep in mind that a credit card is a financial instrument, which you can use as cash in advance and have to pay back your money later. If you are unable to pay the credit card balance on the due date, then you have to pay extra money in the form of interest. If you use a credit card properly, it plays an important role in building your credit score and credit. So through this article, we are going to give you some tips about credit cards.
Some tips about credit cards
Keep in mind the following points when using a credit card for the first time –
Use credit card limited
If your income is low, then your credit card credit usage limit will also be less. In this case you should use limited use of the credit card and never exceed the limit. You should try to never use more than 30 to 40% of the credit limit. If you use more than this limit, it hurts your credit score. If you use a credit card excessively, it shows the extent to which you are dependent on the credit card, which has an inaccurate effect on your credit score. Try to pay less than credit card expenses and pay your dues carefully before the due date. If you have a low income, try to use credit cards only in emergencies. If you use a credit card with proper management, then you will avoid debt and it will also have a good effect on your credit score.
Understand the importance of credit card due to date
If you are a credit card user, then you will know how the credit card works. The due and due date of repaying the credit card dues are important. It appears on your statement. Credit card users are required to pay their dues by this date. You should spend as much as you can pay. Do not spend more than this. However, if for some reason you are not able to pay the full amount of the credit card, you have the option of paying the minimum amount, but if you once paid less than the full amount, your outstanding balance will continue It is more likely to increase. Also, you may have to pay interest on it. Try to spend as much as you can and always pay on the due date. Never miss it If you often forget the due date, you can opt for auto debit.
Do not shop
Seeing someone or buying something similar to someone is a popular habit among young professionals. Youngsters always want the latest trendy clothes or accessories, but if you have a low income, then you should protect yourself from this type of shopping. Because if you will spend more by looking at others, then later you will have trouble in paying the outstanding amount. Therefore spend according to your income. Credit card users are advised by financial experts and are urged to be alert to their spending habits. People should understand that due to the shopping spree you may have a huge debt. So use credit cards wisely.
Do not use a credit card to get rewards points
The rewards point is an attractive way to earn back some money spent through a credit card. Various credit card companies offer cashback, reward points and rebates. However, credit cards should not be used for these purposes only. If you think that by using credit cards more, you will earn more through rewards points and cashback, then your thinking is wrong. Because along with your income, the credit card limit is also low. In this case, you should use it with caution. If you get 5% meaning 500 rupees cashback on the purchase of ten thousand, then it is nothing compared to the money you spent. So use the credit card properly, so that you don’t have to worry later. Along with this, credit card interest rates are also high. You may also have to pay additional rupees.