Credit cards, when utilised appropriately, can be highly advantageous in helping you to attain your financial goals and to ensure your CIBIL score range is above 700. The right credit card can provide you with convenience, incentives, cashback, discounts, and other benefits that will help you save money and improve your lifestyle. However, in order to achieve financial independence and use Credit Cards to your benefit, you must be wise and cautious. Because credit cards allow you to borrow money instantaneously and practically anywhere, they provide some invaluable benefits that can be the key to ensuring your financial freedom. Here are some pointers on how to get the most out of your credit card:
Select the best credit card for your needs: There are numerous credit cards available, each with its own set of features, bonuses, fees, and interest rates. Compare and select the credit card that best meets your needs, payback capacity and also helps you increase your CIBIL score to be able to come within CIBIL score range. For example, if you frequently purchase online, you might prefer a credit card that offers cashback, rewards points, discounts, and so on.
Pay your credit card bills in whole and on time: One of the most fundamental credit card requirements is to pay your bills on time and in full each month to ensure your CIBIL score range doesn’t get affected. If you don’t know what is CIBIL score, you should know that this will save you money on interest costs, late payment fees, and penalty penalties, which can pile up over time. It will also assist you in maintaining a strong credit score, which is required for future loans. If you pay your credit card payments on time and in full, you will be able to take advantage of the interest-free period. This means you can use your credit card without incurring interest for up to 50 days (depending on your billing cycle).
Note: If you are having trouble paying your credit card payments in full each month, try to pay more than the minimum amount required. The minimum amount due is usually a small percentage of your overall outstanding balance, which indicates that paying the minimal amount will take a long time to erase your debt. Furthermore, you will end up paying a significant amount of interest on the remaining sum. As a result, attempt to pay as much as you can each month to lower your debt faster and save on interest charges while also helping you to come within the CIBIL score range.
Make good use of your credit card benefits: Credit cards provide a variety of reward programmes that can help you earn points, cashback, vouchers, discounts, and other perks for your purchases. These prizes can be extremely useful if you use them correctly and redeem them for items that you require.
In an emergency, use your credit card: Credit cards can also serve as an emergency fund, allowing you to cover unforeseen expenses or emergencies like medical bills, car repairs, home repairs, and so on. For the same, your score should be within the CIBIL score range. Having a credit card on hand as a backup can provide you with peace of mind. However, you should only use your credit card as an emergency fund if you have no other option and are convinced that you will be able to repay the amount in a short period of time. You should also avoid using your credit card for non-essential or impulsive purchases, which can lead to debt and jeopardize your financial independence.
Use the extended spending capacity: As long as you can repay your lender, you can use your credit card to bridge tiny gaps between your income and expenses. What’s another great thing about credit cards is the interest-free period (often 40-50 days). Furthermore, repayment periods are generally flexible, and you can make minimum monthly installments rather than return the money in a big sum. You also have the option of converting large-ticket purchases bought with your credit card into EMIs, which gives you much-needed time to pay off your debt with minimum interest payments.
Can make sure of Fuel discounts and frequent flyer miles: Depending on how you travel and what you spend the most money on, credit cards can be extremely beneficial provided you also know what is CIBIL score. However, picking the correct credit card is critical, as you can benefit from frequent flyer miles, fuel discounts, and numerous freebies in terms of dining, shopping, and more. Points earned through card purchases can also be redeemed for additional perks such as discount certificates, free fuel refills, or flight tickets. However, because each of these credit cards has its own point structure, you should thoroughly read the offer paperwork before signing up.
Helps you track your expenses: One of the most significant benefits of using a credit card is that you will always have a detailed record of every purchase and expenditure. This makes keeping track of your finances and planning your monthly budget much easier.
Credit health: Although credit ratings are still relatively new in India compared to other areas of the world, the trend is gradually gaining traction. When making lending decisions for future loans and credit cards, lenders rely on credit health information collected by CIBIL, Experian, and other credit agencies. In such instances, if you don’t know what is CIBIL score, candidates with a positive past that demonstrates their creditworthiness are given preference. As a result, a credit card can help you improve your credit score in the future
Credit cards may be highly advantageous if used safely and wisely. They can assist you in achieving financial independence by providing convenience, incentives, cashback, discounts, and other benefits that can save you money and improve your lifestyle. As a result, it is critical to understand what is CIBIL score and how to use credit cards to your advantage in order to obtain financial freedom in your life.