This time a review on Credit cards. When the name Credit card comes, lot of people straight away say NO, not a good option to opt for. But let me tell you that, it is completely wrong understanding that the people have. Of course if you do not use it wisely then you find your self in a mess. If you could remember, in one of her songs SHANIA TWAIN aptly describe about this CREDIT CARD!! I am unable to reproduce it, it was something like ’’ We enjoy the money which we dont possess and end up in a shopping mall every sunday..’’
The few wrong assumptions that people have in their mind which make them feel that it is DANGEROUS to have a credit card:
Lot of hidden charges.
Interest on what you spend.
Huge interest rates on whatever you buy.
I dont know who have spread these rumours about credit card because I came across with so many people who said about the above things to me. Trust me they are outright lie.
No hidden charges are there for any bank. Trust me as I have been using the cards from almost all banks now (Citi bank, HSBC, Stanchart, ICICI, SBI) and nobody has charged me with any hidden charges till now(Almost 2 years of usage). Citi bank charges you with the Premium amount every month but you could disable it by a phone call.
There is absolutely no interest on what ever you spend for certain days. Almost all bank would give you a minimum of 45 days to repay all that what you have spent. Some banks(Ex: Stanchart) gives you a maximum of 50 days ! if you pay only the ’’Minimum amount due’’ or if you forget to pay the amount, only then you would charged with the Interest. Other wise there is no interest at all if you pay the bill within the due date.
The funda behind the credit card is simple if you keep it SIMPLE (KISS ???)
I would always recommend my friends to get credit card and start using it. But always make sure you pay the entire amount due within the due date to avoid the late charges and also the interest.
The main Advantages of using Credit card than money or debit card:
You would get a maximum of 45-50 days time to repay the amount.
You would get the interest on the amount that you have spent. I mean, if you do not use the money then obviously you would get the interest on that amount of money left in your savings account for that month.
You would get bonus points if you use the credit cards on collection of which you could use them to exchange with goodies.
You need not carry money in your wallet all the time. In Bangalore, every where people accept credit card. So you need not carry money with you. So no danger of losing the money incase if you lose the purse. Of course yes, you need to give a call to your CC company to block the card as soon as you lose it so that you are spared if the card is misused.
In Internet shopping this is the safest and best way to buy the articles.
You get discounts upto 15-20 % for products if you buy them with a particular credit card. For example the HSBC GOLD card has 10% discount on the things that you buy in Big Bazar, Shoppers stop etc etc.
You get discount for dining out aswell. So take your GF tp dining every now and then and along with enjoying the company of her enjoy the discount as well:-)
Most of the cards provide FREE PERSONAL ACCIDENT INSURANCE.
If you a frequent air traveller then you would get upto 5 % discount.
10.Now a days most of the Cards come with LIFE TIME FREE option. So no need to pay the yearly fee as well.
But everything said and done..... Credit card business can drown you if you are not smart enough!!!
Some useful tips on how to spend on credit card and enjoy the FREE credit with out having to pay a single penny:
Always use the credit card to buy items which you could pay at one shot, never pay only the minimum amount due. Or incase if you use it to buy something which is expensive then do not forget to pay it at one shot. The bottom line is no matter how much you spend, always make it a point that you clear all the debt at once.
Never ever go for MONEY from the credit card. You have the option to take money on your credit card upto 40 % of the credit limit. If you go for it, you would be charged at a whopping 36 % Per year from the day you barrow it and it would be applicable until you pay the whole amount back.
Do not forget the DUE Date of the card. Or else you end up paying LATE PAYMENT FEE, TAX , INTEREST on the amount.. etc etc....
4. Never go for the loans offered on your credit card. If you really want some money then go for personal loans than going for these CC loans, Life would be simpler for you that way.
All in all I would say.. if you are SMART ENOUGH then definitely go for Credit card. Or in other words, CREDIT CARD is meant for those who are SMART!
This is my personal opinion after using Credit Cards for 2 years now. Of course it depends on your life style as well. There are people who would just go on a buying spree and could not control. When the bill comes, there you go, start paying in installments, miss some of the due dates and end up paying HUGE Amount of money back.
Be careful fellas.......! Do not make your life HELL on earth by over spending :-)
Enjoy the money which you do not possess but pay it back in time .. :-)
Your comments are always welcome
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Amith