Online and Offline: Tips for beginners to use credit cards
Although credit card offers unlimited financial freedom to its users, it should be used wisely. Credit cards are extensively used from making purchase online to paying your restaurant bills. As a first time credit card user, you must be smart enough to take up the responsibility of maintaining your credit card account. So, here are some tips that help you to use your credit card wisely both online and offline as well.
Plan a Strict Budget
Easy availability of credit may often tempt you to spend more than what you can actually afford. Such reckless spending may result in troubles with your financial planning which is not a healthy trend. You must plan a strict budget and stick to it at any costs. One of the best ways to track your expenses online or offline is to register your contact number with your credit card account. Every time you use your card, you will get alerts over your handset, with the details of your expenses and the balance in your card.
Don’t Increase your Credit Limit
Once you get a credit card, the bank sets a credit limit based on your income. In due course of time considering your repayment capacity, the bank may be willing to increase your credit limit. Although this will enable you to purchase more it could sometimes put you into endless trouble of debts. Hence, it would be wise not to increase your credit limits until the end of the first year or till you get a hang of dealing with credit card payments.
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Check for the website address
While shopping online, make sure that the website address begins with https:// and not http://. This prevents the hackers and other users from accessing your credit card information. Once you have selected the product, the site will ask for your credit card and shipping information. After entering those details, the website will ask for your CV number that is located on the back of your card. Make sure not to disclose your CV and credit card number to anyone. Once you are through with the purchase, you can check your card status online to ensure that everything went fine and no other unofficial activities on your card have taken place.
Never make online credit card purchases from a public place
Networks at public places are usually badly secured. They have key logger software that will keep track of all your keystrokes such as your credit card number and passwords. Hence you will be at a greater risk where your card would be misused.
Always Pay the Full Amount on Time
Every month, you will be notified through a statement about how much you have spent and the due date before which you have to pay the minimum amount. Make sure to pay the stated amount on time or you have to bear the penalty.
Secure your card
Whenever you use your card, make sure the salesperson swipes it properly and there is no chance of misuse. Also don’t share your CV and credit card number with anyone else. In case you are using the card online, make sure to print the receipts and verify it later with the billing statements you receive.
Avoid Cash Withdrawals
Avoid using your credit card to withdraw cash from ATM or other banks. This is because you will be charged a high rate of interest like 1.5 – 3.5%. This interest continues to get added till you repay the full amount. Also there is no grace period for these transactions. Hence, you should try this option only in case of emergency.
Although the credit card offers a lot of benefits, there are a few common pitfalls that get to be noticed and avoided at all costs. The above tips help the first time users from falling prey to such pitfalls.
Author Bio: Kelly is a writer blogger. She loves writing, travelling and reading books. She contributes to Engage BDR
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