Credit Card, Lifestyle

The Ultimate Credit Card Guide 2019 (Updated)

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Don’t use the credit card. Stay away from the debt. You might have heard such pieces of advice from the financial experts or investment planner. Well, I would say it’s 90% correct. The world of the credit card may seem confusing for the beginners. There are several banks offering different credit cards with attractive offers and benefits to attract customers. And these offers can mislead you. Don’t worry here is a comprehensive guide to choosing the best card according to your financial needs. But, first, let’s get familiar with a credit card function.

Credit Card Meaning:

In case you are not aware and looking for credit card meaning then here it is. Credit card is a plastic card issued by banks or financial organizations allowing you to purchase goods or services on credit.  With credit cards, you can purchase the products or services on credit and repay it later. Though there is a pre-assigned credit limit and you can not spend beyond it. Making sense?

Credit Card Uses:

Credit card allows you an interest-free period of 45 to 50 days for credit card bill payment. That’s mean if you settle your credit card payment within this period then you will not attract any interest on your purchase. If you cannot settle the complete amount, then a bank offers to pay a minimum amount option and roll over the rest amount. However, this unpaid (rollover) amount attract the daily interest. So it’s always recommendable to make the credit card payment within the time-frame. So you can avoid the unnecessary burden of interest.

Credit card Benefits:

  1. Reward Points: Most of the credit cards give you rewards on your  online/offline transactions. You can redeem the reward points for a gift or shopping vouchers.
  2. Discounts on Online Shopping: You can earn huge discounts with your credit card on your online purchase. For example, HDFC Bank Credit Card offers a 10-25% discount on BookMyShow. Whereas Citi credit card offers up to Rs 5000 OFF on Croma store and MakeMyTrip.
  3. Cashback Offers: Some credit cards offer cashback on a specific type of shopping. For example, standard chartered credit card gives 5% cashback with LifestyleStore purchase.

Further, let’s check out a few pros and cons of credit cards:

Sr No.

Pros

Cons

1

It is easy to carry and use as compare to cash.

It’s carry high rate of interest it could be between 25-45% yearly
2

It is safer to use and has limited liability in case of fraud.

There are additional charges are associated with credit cards like annual charges, late payment penalty, renewal fee etc
3

It allows you online sales purchase.

Missed or due payment directly afect your credit score.
4

With credit cards you can earn rewards, cashbacks and huge discounts.

Credit card make it easy to spend and harder to save.

 

Best Credit Cards In India

This list is based on my personal experience (including my family and friends) and research. You can not choose and define any single card as best. Because diffrent individuals having different financial needs. So visit the site, check out the features and select accordingly.

1)    American Express – Jet Airways Platinum Credit Card
2)   SBI Yatra Credit Card
3)   HDFC Diners Club Credit Card
4)   CitiBank Cashback Card
5)   Citi Bank Indian Oil Platinum Card
6)   ICICI Bank Coral Contactless Credit Card
7)   HSBC Visa Platinum Card
8)   IndusInd Bank Platinum Card
9)   Kotak PVR Gold Credit Card
10) Axis Bank Neo Credit Card

Credit Card & Money Management:

Today credit card have become almost as indispensible as cash money. It is a very powerful tool that could make you or break you. It all depends on how smartly you use it. Here we have mentioned few steps that may help you  to use a credit card like a real pro for money management.

1) Track Your Expenses, then set the regular budget

Before preparing your monthly budget you should be aware with your monthly spending. This is easy to track. There are many budgeting software’s are available online. Just download those softwares and track your money. Just classify the transactions to identify the category.
Even many banks allow you to organize your transactions category wise, such as restaurants, clothing or groceries for your credit card. For a quick snapshot, my favorite practice is to go throughout a credit card summary.
Once you figure out your monthly expenses, now you can prepare your budget.

2) Review Your transactions

For money management, it’s important to review your monthly or weekly budget to make sure you are spending within your set limit. Check credit card summary to give you a view of your expenses. Review your transactions. Figure out where you are spending more and try to control that expenses if possible.

3) Set A Monthly Spending Limit For Your Card

Set a monthly limit for your card. This is an easier way to stay within budget. For example, if you’ve prepared a monthly budget of $1000 set the same limit for your card. Once it will get done check, your overall spending at least once a week to make sure you’re on a track. So if your monthly limit is $1000, and you hit $800 on 20th of the month, you need to control your remaining expenses within $200 or less. You can adjust your monthly limit on a time-to-time basis when you have irregular expenses like an insurance premium, hospitality or vacation.

 

It is always prudent to stay away from the debt product like a credit card or loans. But, responsible use of credit card could attract many rewards and financial benefits. You won‘t believe but this piece of plastic can be a great money management tool if you use it intelligently.

Aamir Khan

Aamir Khan is the founder and CEO of iplanyourmoney.com! Aamir having a deep interest and almost 4 years of experience in the banking & finance sector. He is a blogger, web entrepreneur, and a professional in the corporate world.

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