How to use a Credit Card wisely

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A credit card is a great financial tool in the hands of a rational and wise consumer while it creates bondage of debt to those who make misuse of a credit card. One basic thing that should be clear to all credit card holders that credit card is not your money, it is the money you borrow from a credit card issuer, so you should use this money wisely. You should be careful while using a credit card because its quite easy to fall in a debt trap too quickly.

So today i am going to tell you the ways to use a credit card wisely :-

1) Stop adding more debt

Rate of interest of credit card is too high. Its quite easy to get debt via a credit card, so people takes more and more credit from a credit card and at last create a huge debt on them. Never try to take debt from one credit card to pay off minimum balance of another.

2) Pay off the Credit Card balance every month

If you have already made a monthly budget for your household income and expenditure, than you won't find problem of Debt Snowball. Debt Snowball is the slow and steady increase increase of debt which an invidual unable to pay off in future.

3) Avoid Cash withdrawls

Normally interest rates on cash withdrawls are higher than purchase APR. Further the credit card issuer charges some fees when you try to withdraw cash from an ATM using a credit card. So you should avoid using credit card for withdrawing money from an ATM.

4) Never share your Credit Card information with anyone

A Credit Crad issuer never asks for any kind of information regarding credit card via phone, email or any other such source. Sometimes scammers tries to steal your credit card information for making misuse of it.

5) Change in terms of Credit Card

Always keep an eye on changes in terms of a credit card. Always pay an attention to what a credit card issuer sends you via post ot email. The credit card issuer may add some new fees or increase the rates of current fees. So you should know what is happening with your credit card.

From the above, we can conclude that A credit card can either be a great financial tool or a source of big debt, it all depend upon its safe and brainy usage. So use your credit card wisely.


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