How to Use Your Credit Card Effectively? 5 Simple Tips

As a credit card holder, you can easily finance purchases even while you’re low on liquidity. However, in order to use this tool to your benefit and refrain from spending more than you can repay, it is key that you follow certain measures. Err on the side of caution and learn how to use a credit card to your benefit by following these 5 tips.

1. Monitor your spending and keep to your monthly budget

Following your monthly budget is vital if you want your finances to flourish, and even more so when you have a credit card. Since it can be very easy to give into impulse purchases and overspend when using borrowed finances, it’s important that you monitor your card usage periodically. This practice will help you ensure easy repayment and will also keep your credit utilisation ratio within desirable limits.

2. Make utility bill payments and build your credit score

Once you obtain a credit card, use it to tackle some of your recurring expenses like utility bills and rent. In other words, use it to pay bills that you have to pay regardless, whether or not you have a credit card. There are three advantages you can enjoy when you do this. Firstly, since expenses like gas and electricity are incurred regularly, you can save yourself time and effort by simply automating bill payment through standing instructions. 

Secondly, by using your credit card and paying the bill on time and in full, you can boost your credit score. Finally, since some types of credit cards even offer cashback rewards on utility bill payments, you can save a significant sum.

3. Pay your credit card bills in full each month

When it comes to credit card payment, try to pay your bill in full. This is because any amount that is outstanding will attract interest as per the high rate stated by your issuer. When you receive your credit card bill, you will have the option of making either a full or a minimum credit card payment. 

However, in the event that you do not pay your credit card bill in full for more than one month, the outstanding amount will get added to your total due and this larger sum will accrue high interest. In a nutshell, your outstanding debt will grow at an alarming rate. 

4. Enjoy discounts and deals when travelling abroad

Going on a holiday abroad can be an expensive matter, but you can make it budget-friendly by making the most of the deals and discounts offered by your credit card. For example, some types of credit cards allow you to accumulate air miles that you can later use for travel. 

Others like the Bajaj Finserv RBL Bank SuperCard give you jaw-dropping discounts on flights and hotel bookings. Incidentally, the SuperCard’s World Plus variant allows you to earn 20 times the reward points when you shop and dine overseas.

5. Use the EMI option to make big-ticket purchases affordable

If you are looking to make a high-value purchase like a refrigerator or TV, you can lower the financial strain by converting your bill into EMIs. This way you pay smaller amounts over a long tenor and avoid having to take a personal loan or break any investments. The Bajaj Finserv RBL Bank SuperCard is truly one of the best credit cards in India in this regard. It allows you to pay for purchases above Rs.3,000 via easy EMIs.

This 4-in-1 credit card also offers liquidity by way of 50-day, interest-free cash withdrawals at ATMs and a 90-day, interest-free personal loan. By using this card regularly, you can enjoy savings of around Rs.55,000 annually.

Check your pre-approved offer from Bajaj Finserv and apply for a credit card right away. This simple step will give you access to customised credit card deals, instant approval and expedite the process of getting a SuperCard.