Credit card can be a beneficial financial tool, if used carefully. If not, it can turn into a menace for your finances.
Ideally, you should set a budget before you make purchases through your credit card. And only spend as much you can pay back, after all it's not your money.
Here are few things you should always keep in mind before you become debt-ridden:
1. Limit your credit card use
Usually, there is an interest free period for every credit card. So, in order to avail it, you should ideally keep your credit card dues nil.
As long as you pay the amount on time, you can take advantage of the interest free period.
2.EMIs and Reward Points
It is recommended that you should always transfer you balance to EMIs (Easy Monthly Instalments). Doing so will help you pay your debt more easily on less interest charges.
Also, every credit card purchase means earning rewards points. Never overspend just to earn them.
3. Never withdraw cash through your credit card
Do not forget that cash withdrawals from your credit card will incur both one-time fee plus high interest charges.
So, it is not advisable to take out cash via credit card unless you are in dire need.
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