Do’s And Don’ts for Credit Card User

It’s a match

keeping an eye on your usage of the credit card from time to time is a good idea. It gives you a basic idea about the type of purchases you usually make. Whether you are an experienced credit card user or a new user, knowing the type of credit card you have is beneficial. Knowing the type of credit card you have can help you earn the highest benefits when you use your credit card for that specific purchase. You can opt for a card that offers you the most benefits based on your common usage. For example, there are credit cards offers in UAE for the best benefits like shopping, travel, restaurant, movies, etc.

Some members use their credit card to pay for their children’s school fees, while some use it for shopping.

Stay in Limit

Before using your credit card on anything flippant, slow down and remember that credit card is to help you out with your finances. So, make sure to use your credit card carefully. Don’t exceed the credit limit. The bank has a credit card limit for a reason. If you exceed your card limit, you will be charged accordingly by the bank.

Pay for Daily Expenses

Paying for your daily expenses using your credit card is a very good idea. As these are the expenses that are always regarded while accounting your finances, it will be easier to pay off the debt every month. It will also affect your credit score in a good way. As you know, to keep a good credit score, it is necessary to spend a certain amount using your credit card every month and pay your credit card bill on time. Using your credit card to buy your daily needs will not only benefit you in rewards but also help you to keep a good credit score.

Benefits

As stated in the first point, you get certain benefits when you use your credit card. You are rewarded according to the type of card you have. Some credit cards even offer travel benefits, golf privileges, airport lounges, healthcare memberships and lifestyle perks too.

But some cards have an expiry date on their credit card benefits. It means that if you don’t use your rewards and offers within a limited time, your rewards and offers will be nullified and of no use in the future.

Pay Your Bill

There’s no doubt that credit card is preferable, compared to cash. And if you wish to continue availing the benefits of credit cards, make sure to pay your bill on time. Don’t make the mistake of paying just the minimum amount as it will further put you in debt, with the increasing interest rates. Paying your bill on time will help you keep a good track record of your finances.

With that ends the list of things you should do with your credit card. And the followings are the list of 5 things you should not do with your credit card.

1. Don’t Miss Your Bill Payment- Everybody understands that credit card makes things easier without worrying about having insufficient cash at that moment. Pay your bill on time if you wish to continue enjoying the comfort of your credit card. If you don’t pay your bill before the end of the billing cycle, the bank will charge a late fee.
2. Don’t Invest Using Your Credit Card- Using your card to invest in a property is a risky move. You have a higher risk of being in debt to the bank. Also, an asset like a house cannot be liquidated easily. Therefore, avoid short term funds like credit cards with high-interest rates to buy a property. Also, don’t make the mistake of investing using your credit card. Investments are a risk with no guarantee of success. As Warren Buffet said, “In the business world, the rearview mirror is always clearer than the windshield.”  Using your credit card for investment is putting yourself at risk without a backup plan to fall into.
3. Don’t Make International Purchase- Not many card members know that when you use your credit card abroad or in international websites, you are charged higher interest rates than domestic purchases. Also, you are charged a fee for every transaction that you make internationally.When using your credit card for international transactions, you are charged currency exchange fee and the fee for using your credit card. Even cash transactions abroad, are charged higher interest rates than normal.
4. Don’t Purchase Gold Using Your Credit Card- With the low cost of gold in Dubai, jewelry shopping certainly becomes a temptation for most people. Some people with credit cards end up using their credit card to purchase the gold and that is not a good idea. Even if you are sure that you can pay off the debt with your income, you might not be aware of the fact that most jewelry shops charge extra 2 percent to 2.5 percent when payment is made via cards.
5. Don’t Share Your Card Details- This is one of the most important things to remember for your credit card. Never share your credit card details with anyone. Sharing your card details makes you vulnerable to frauds. Also, avoid shopping on websites that are not trustworthy. With the increasing credit card members, credit card frauds have been on the rise too.

Over to you

It doesn’t matter if you are a new user or an experienced user, if you have read the above DOs and DON’Ts carefully, you will be able to use your credit card smartly. Think before purchasing with your credit card. Think carefully whether you really need the item or not before making a purchase.