Credit cards can be the best way to pay for your transactions as they let you transact on credit and then pay for them later on. Moreover, each transaction that you do with your credit card earns you reward points which give you gifts and other privileges. Given these additional benefits, many of you choose multiple best credit cards for enjoying the maximum privileges. But do you know how to manage your credit card for the maximum possible benefits?
Though credit cards have additional benefits, they might prove to be a curse if you don’t manage them well. So, here are some tips which would help you manage your credit card perfectly so that you can enjoy maximum benefits without facing the disadvantages –
- Make a budget and stick to it
Since credit cards allow you credit transactions, you might get tempted to overspend. This is a mistake. Though you can buy on credit, you would ultimately have to pay for your purchases when the credit card bill is generated. If you overspend, the bill might become unaffordable which would not only incur very high-interest rates, it might also lead you to a debt trap.
- Always pay the bill in full and on time
When your credit card bill is generated, you have the option of paying the minimum amount due and revolving the remaining balance next month. Though it is a tempting offer, stay away from it. If you pay only the minimum amount due, the remaining balance would start attracting interest. Moreover, in the next billing cycle, every transaction that you do would also attract an interest causing the interest charges to rise exponentially. So, always pay the bills fully. Moreover, the bill should be paid on time to avoid interest charges and also a negative impact on your credit score.
- Use the reward points wisely
Keep a track of the reward points which you earn with your credit card transactions and then use the reward points to get maximum benefits. Redeem the points only against useful gifts and vouchers or you can also use the reward points to pay off your credit card bills partially or fully. Many cards also give you the option of availing cash backs through the accumulated points. Avail this option only when the cash back is better than other benefits promised.
- Be careful with multiple credit cards
When you have multiple credit cards, be careful of their payment dates. Try and keep the due dates of all the cards same or near a particular date. Establish reminders so that you don’t forget the payment. Better still, arrange for an auto pay facility with your bank account so that your credit card bills get paid on time automatically through direct debit from your account.
- Track your spending
Always track your credit card spending. When you get your credit card bill there would be a list of all the transactions done using the card. Review the list to make sure that there are no erroneous transactions which you might not have done.
These are some very handy tips which would help you manage your credit cards perfectly so that you reap the maximum benefits and don’t incur additional charges.