Credit cards are easy to tool to use. If you don’t have sufficient balance in your account, you can pass the balance to another month, then another month and eventually, before you will know you will get yourself trapped in debt. However, if you carefully manage your credit card use, they can never bring a downfall for you. These are some of the ways by which you can manage your credit card finances.

Easy Steps to Manage Your Credit Cards:

  1. Choosing the right product for you:  Almost every day we receive several calls for credit card offers but does all the credit cards benefit you? Understanding why you need the credit card is the first step! If you want to use the credit card for travel or shopping, then there are credit cards, specially customised for that purpose. You must carefully choose the right credit card which that has a low-interest rate. Along with that, you must also compare other pros and cons of the credit card such as cashback offers, transaction fees etc.
  2. Building a credit history: A credit card holder must know how to use the credit card. If you are worried that using the credit card will affect your credit score, it isn’t! It may, however, lower the credit score. You must also not overuse the credit card as if you are exceeding the credit limit then you miss the credit card payment and it may further impact the credit score severely. Thus, make sure that you pay all the credit card dues on time as it will help you to build a credit history. Also, if you have multiple cards, and you have missed payments, don’t close your credit card account as it will affect your credit score.
  3. Getting low-interest on your credit cards: Having a good reputation with the credit card company along with building a good credit score helps you to negotiate with them. You can talk to them about lowering the interest rate. If that doesn’t succeed, you can always switch to another card that is offering a lower interest rate. However, always calculate the transfer fees; otherwise, you end up paying more. Thus, you must ensure that you don’t pay high interest on your card.
  4. Making payments: It sounds boring but preparing a budget for using the credit card surely helps. It would help if you planned how much and where you will use the credit card. Planning the utilisation of a credit card can help you to avoid financial hurdles. Also, you need to stick to your budget; otherwise, you would end up using it recklessly. If you can’t do that, don’t have a credit card because not having a credit history is much better than having a poor credit history.

It is crucial to calculate the risks if you miss the credit card payments or don’t pay the full balance of the credit cards. Not only will you have you pay penalty fees and interest for late payment, but you may also end up losing credit card control.

How to Manage the Risk your Credit Card:

Credit cards are easy to tool to use. If you don’t have sufficient balance in your account, you can pass the balance to another month, then another month and eventually, before you will know you will get yourself trapped in debt. However, if you carefully manage your credit card use, they can never bring a downfall for you. 

  1. Understanding why you need the credit card is the first step! If you want to use the credit card for travel or shopping, then there are credit cards, specially customised for that purpose. You must carefully choose the right credit card that has a low-interest rate and always compare other pros and cons of the credit card such as cashback offers, transaction fees etc.
  2. If you are worried that using the credit card will affect your credit score, it isn’t! It may, however, lower the credit score. You must also not overuse the credit card as if you are exceeding the credit limit then it may further impact the credit score severely. 
  3. You can always talk to your bank about lowering the interest rate if you have a good credit score. If that doesn’t succeed, you can always switch to another card that is offering a lower interest rate. 
  4. It would help if you planned how much and where you will use the credit card. Also, you need to stick to your budget; otherwise, you would end up using it recklessly. 

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