The Ultimate Guide to Choosing the Best Credit Card
We all try to make our lives as convenient as possible, whether it is booking tickets from our couch or ordering gourmet food in just a click. A credit card helps you do all this without any hassle. It is one of the most convenient payment methods you can use and avail of many other benefits such as exciting rewards and vouchers. It also ensures fully secure payments, and there is no need to carry cash around anymore. Moreover, you get access to a wider range of online services with a credit card.
Besides the plethora of benefits a credit card offers, it is crucial to remember that the purchases you make with it act as a loan that you have to pay back. Therefore, spend wisely to avoid any troubles later.
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If you want to apply for a credit card, here are a few points to consider before you make the final decision:
- Credit Limit
Credit limit refers to the maximum amount a credit card provider allows to draw against the card, without sustaining any penalty. While looking for a credit card, it is essential to know about your creditworthiness, which depends on your credit score, repayment history and income.
For first-time credit card users, it is advisable to be content with the credit limit they get and learn how to use it wisely. Later, you can get the option to increase the limit according to your monthly expenses. Also, you must know that spending a lower percentage of your credit limit is beneficial to your credit score.
- Credit Card Fee
Credit card providers often levy fees for offering credit cards. This includes a joining fee, annual fee, late payment fee, cash advance fee, and rewards redemption fee. Apart from these, the credit card issuers you choose may also charge a host of other fees and penalties such as over-limit charges, payment return charges, cash payment charges, and outstation cheque processing fee.
Therefore, when you look for a credit card, make sure you check for the fees and charges that apply to the card.
One of the best benefits you can gain from credit cards is the rewards. Your everyday purchases can make you earn points, which you can apply toward travel. Retail purchases, cashback, and more. While choosing a credit card, pick a card that gives you rewards for where you spend the most, commonly gas stations, grocery stores, or online retailers. However, you must only spend on what you would ordinarily buy. Because spending more just to get a reward won’t save you money in the end.
- Interest Rate
If you are applying for a credit card for the first time. And you are not sure about your repaying ability. Then the interest rate is the most crucial factor to consider when choosing the right credit card. Just a few months of carrying due payment can cost you a lot in interest charges. So the lower the interest rate on the credit card, the better. Although all credit cardholders, if repaying the bills on time. Need not worry about the interest charged on dues.
Responsible Credit Card Use
We all agree that a credit card makes our life easier in many ways. However, there is a thin line between use and abuse. Make sure you handle your expenses wisely while using a credit card. Reputable banks such as Axis Bank offer customized credit cards for individual needs and various benefits, including vouchers, cashbacks, memberships. And even travel benefits. It is crucial to check your credit card eligibility before applying for it to avoid any chances of application rejection.