Every finance needs to be planned, whether it is going to be involved in certain or uncertain times.
Why I am saying that finance needs to be planned is, if you spend without planning, then you will end up in debt.
Certainty is like buying a house, car, mobile phone etc....
Uncertain is like injury, accidents, loss of life etc...
Some can be avoided and some can't.
Credit card is one such tool, if used properly, it does wonders else you will end in debt.
This tool also helps us to manage our own economy. When I mean 'our own economy' it means, the way we buy things, make our payments and ways or channels involved for this payments & credits, transforms as a data feed for our economy in which we live in.
By default, credit card has many advantages, however many don't understand it and for them it becomes a nightmare.
Advantages of having a Credit Card
+ 30 - 60 days of credit period
+ Low interest rates or Interest free periods
+ Reward Points
+ Discounts
+ Balance Transfers
Other factors, that actually work behind are...
+ your purchases becomes legal compared to cash, as your merchant, your credit card provider, payment gateway, merchant's bank are involved in processing this payment.
Purchasing any item using your Debit Card or Credit Card provided by your bank has the same advantage, however credit card gives some time to pay-back, where as when you use a debit card, the money is removed immediately.
When to use credit cards
1. Buying items which are affordable by you.
2. Buying things, which you can pay immediately using your debit card also.
3. In case of emergency or medical requirements during uncertain times
How to use credit cards
Stated earlier, every thing is planned. So, when you are using your credit card, you should plan before using it, else it uses you.
1. Always buy anything immediately after the statement date ONLY, to get the maximum credit period.
2. Use the credit card, which gives you the either of these for your purchases
+ Cash Back
+ Double Reward Points
+ Interest free periods
+ Low Interest Conversion EMI's
+ Flat % Discounts at certain places
What type of credit cards, can be subscribed?
When buying any financial product, never go with the leader however follow the leader constantly.
The reason is, the leader sets rules, however the contender always tries to defy them and create new ones.
The pressure will be always there with the leader to be in the lead, where as the contender wants to emerge as a leader, so they give 200%.
Most of the market trends are identified or defined by the leader, where as the contender easily taps the market without much issues, because the concept is already familiarized by the leader in that segment.
Why I am stating all this is...VISA card , MASTERCARD and AMEX cards have different set of benefits. So, do compare them before subscribing.
It does not depend only on these, it also depends upon the bank from which you are getting the card. Emerging banks will always introduce schemes to attract customers. Ensure that you subscribe and utilize those benefits.
Happy credit free days ahead...
