Need Credit card then this article How To Choose A Credit Card According To Your Lifestyle? going to help you.
A credit card is not only a status symbol, but now it is a necessity also. It is both helpful as well as very risky. The advice for using the credit card is to spend wisely and make full & timely payments to avoid any kind of unhappy situation.
Using properly a credit card will enhance your credit score and your requirement of immediate funds will also be fulfilled. But it’s the wrong usage can result in damaging your credit score.
Don’t hesitate from choosing a card for yourself rather keep all these things in mind while you are on a hunt of choosing a car that suits your lifestyle also:
How To Choose A Credit Card According To Your Lifestyle?
1. Your Spending Habit
Before selecting a card, ask yourself a question what is your plan about using your credit card. Will you be a person who will pay monthly credit card bills regularly or will you consolidate your credit card debt month on month?
When you will use your card whether in emergencies or on regular basis?
The interest will not be an issue for you if you are going to pay the bills of your card on the regular basis. The card that will give you maximum cashback and discounts will be a great option if you are going to use it for your regular spendings.
You will need a card which has low interest and annual fee if you wish to carry a balance. A no-frills card having the lowest possible fees and interest rate will be the best option in case you want to use your card only in emergencies.
For choosing a card, you will have to analyze your need and do a comparison and then make a selection.
2. The Rate Of Interest
The rate of interest appears as APR or annual percentage rate on the credit card, which can be either fixed or variable Your rate of interest will be fixed or floating will depend on another financial indicator which is the prime rate.
A fixed rate gives you the benefit of already knowing the rate of interest that will be charged from you every month. But the case of the variable is different as it keeps on changing.
3. Credit Limit
The amount that your card issuer will be ready to let you borrow will be your credit limit. Initially, when the card is issued to you then your income becomes the basis of setting the credit limit for you.
After that, your payment history becomes the basis of your credit limit and it can be increased or decreased depending on that. Avoid that situation in which you are about to exceed your limit as it will damage your credit score.
4. Fees And Penalties
The most common charges that come with your credit card include transactions fees, such as cash withdrawals and balance transfers, or request for increasing your credit limit or making payment by phone.
There also come some kind of penalty charges on late payments or exceeding your credit limit. In other words, your card will not be declined instead you will be burdened with fees.
You must look out for the card having reasonable fees on balance transfers and no transaction fee such as HDFC Bank Freedom Credit Card. This card has a very low annual fee.
5. Computation Method Of Your Carried Balances
Looking out for the way of computing finance charge is important If you are going to carry a balance. The most common calculation method is the adding your daily balances and then divide them by the number of days in the billing cycle.
Always stay away from those credit card issuers those calculate finance charge taking into consideration two billing cycles.
Your purchases will also give you some reward points if done by using a credit card and there is the bank that does this. You will also find many issuers that don’t charge for redeeming these reward points such as ICICI Insta Platinum card.
This card gives you 3 payback points of every Rs 100 spent and there is no charge for redeeming your reward points. There are many cards that give you benefits on travel, fuel surcharge waiver, or fine dining.
While choosing a card don’t forget to check out the benefits of the card.
So, these were some metrics that you need to take into consideration while choosing any type of credit card.
That’s it all about the credit card.
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