Credit card
Credit card craze is being seen a lot in youth nowadays. Be it breathtaking offers of online shopping or sudden financial needs, credit card has become a useful means for many people. If you are also thinking of taking a credit card, then there are some important things that you should take care of. Let’s know what they are.
Credit limit
Each credit card has a fixed limit, which is called credit limit. It is necessary to ensure that your expenses remain within this limit. Suppose your credit card limit is ₹ 5 lakh, so the total amount you spent should always be less than ₹ 5 lakh.
Credit card utilization ratio
This is the ratio of the credit limit you use and your total credit limit. It is advisable to always keep it less than 30%. For example, if your credit card limit is ₹ 10 lakh, then try not to spend more than ₹ 3 lakh.
Credit score
If you pay your credit card bills on time, then your credit score gets better. A good credit score can help you get a high credit limit on your card in future. For example, if your credit limit is now ₹ 5 lakh and you pay continuously on time, then it can increase to ₹ 7.5 lakh.
Interest free period
On purchasing with a credit card, you get an interest -free duration of about 45 days. During this time, if you pay the entire outstanding amount, then you do not have to pay any interest. However, after this period has passed, interest starts on the outstanding amount.
Minimum dews Total Dew
When you get your credit card bill, it has two options: either you pay the minimum amount (minimum date) or pay the entire outstanding amount. It is always advisable that you pay the entire outstanding amount. If you only pay the minimum amount, then the remaining amount continues to be charged.
Cash withdrawal
By the way, you can also withdraw money from credit card, but it should be avoided. The interest on withdrawing cash from a credit card is usually very high, so this is not a sensible step.
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