Tips To Use Credit Card SmartlyFor every credit cardholder, it’s really important to use the credit card in the right way. It would not only help you from paying high-interest rates and penalty charges but would also help you to improve and rebuild your credit score. Unfortunately, credit cards don’t come with a manual telling you how to use them responsibly and in a better way. You may have already learned the hard way about the devastating effects of credit misuse, but it’s never too late to start over.
We have come up with few tips that can help you use your credit card smartly:
1. Get started with a credit card:If you are just getting started with your first credit card, ease into it slowly and don’t max out. Instead, make small charges on your card and pay the balance on time and in full every month. A disciplined swiping of a credit card will not only help you manage your expenses in a better way, but will also help you build a good credit score.
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2. Make bigger purchases when prepared:Once you have created a habit of paying your bills in full, you are better prepared to use your credit card for slightly bigger purchases. Keep your purchases low, 30% of your credit limit or less. When you make a purchase using your credit card, keep payment aside so you won’t spend it before your bill comes. Then, when it’s time to pay your dues, you already have payment ready. You can also make a credit card payment soon after the purchase, even if the bill hasn’t arrived yet. If you keep on using your credit card wisely, your lender might increase the credit card limit.
3. Practice self-discipline:You will have to tell yourself ‘no’ when you want to use your credit card to make a purchase but can’t pay your bills on time at the end of every month. If you put money aside to pay your bills, make sure you don’t spend it on something else. Start with just one credit card, so you can keep your payments manageable. Several balances and due dates can cause confusion and lead you in a huge financial trap.
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