Credit card can be smartly used to one’s advantage. It is the only loan that lets you earn interest while you defer the payments. However, one needs to prepare a budget and spend smartly to avoid falling into a filthy debt trap.
Credit card can be smartly used to one’s advantage. It is the only loan that lets you earn interest while you defer the payments. However, one needs to prepare a budget and spend smartly to avoid falling into a filthy debt trap. A strategic use of credit card can help one avail advantages at multiple spend points in form of reward points, coupons, promo codes, cashbacks etc. All one needs to do is follow some simple rules :
- Spend only on what you can afford
- Pay your credit card balance in full every month
In this blog, we take you through some useful tips on how using a credit card efficiently can result in significant savings.
If you wish to spend a significant amount on purchase of items like new furniture, medical treatment, or a holiday using your credit card, do so with a 0% APR (Annual Percentage Rate) as it lets you unbundle your purchase into multiple payments without having to pay any interest.
Use of cashback credit cards lets you accumulate cash rewards to your advantage. However, if you fail to bring back your credit card balance to zero within the introductory period, you may end up losing by paying a significant interest and hefty late charges.
The credit card companies usually have tie ups with several retailers and offer gift cards with bonuses. The reward points can thus be used to one’s benefit by redeeming cashbacks for one of these gift cards.
The credit card companies also have a tie up with a set of national retailers to offer regular discounts to its cardholders. Though it calls for planning ahead, it can result in savings on dining, movie tickets, grocery purchases etc. by shopping through your credit card issuer’s partner.
The travel rewards credit card allows one to earn miles or travel points which can subsequently be redeemed for a free flight ticket or a free hotel stay.
Purchasing extended warranty on high value product purchases protect you against expensive repairs or replacements. However, these plans are often pricey. Some credit cards automatically offer an extended warranty on purchases at no extra cost. One should check to learn whether your credit card offers this coverage and how can this advantage be activated.
At the time of purchase, one often runs the risk of finding out price markdowns a few days later. Many credit cards offer price protection benefits that offer a refund for the price difference.
He who buys what he does not need steals from himself !