Friday, 1 February 2019

Is it advisable to take credit cards for your regular use?

We have always been told that credit cards are bad. Imagine you getting out of a collage and joined your first job, the company provides you a salary account with a reputed bank, which comes with its own privileges. Understanding your incomes and gains, the bank offers you a credit card with good limit. Now you are in a fix, if you should get the credit card or not as it’s always been a negative topic of our lives. We have often heard that these cards will ruin your life and they are not safe at all. Are you in the same situation as the above story?
As every coin has two sides, the same goes with everything you do in life. You will know the same when you are in the urge of getting a card. Credit card can help you in many ways and also can ruin your financial status if not adhered properly. Getting any line of credit is never a problem, but how you adhere is what defines you and your financial well being.
Talking about these cards, we will sight you some good things and also bad things of how a credit card can help you and also take you down if not adhered properly,
Source of emergency funds
This can be the ultimate tool when you are in desperate need of funds and you have nowhere to go. It can help you sort quick funds without any hassles and can get you out of quick trouble. This does not mean you will keep swiping your card every now and then in case of emergencies. It is always suggested to have some funds with you in savings so that it can help you, when in need.
That’s right! You can reward points to spend money. Who does that? Credit card companies have different norms when it comes to providing reward points. It depends from lender to lender and from type of card you hold. For every spent you make, you get reward points which you can later redeem to buy gifts from their website or even sometimes they give you option to en cash it. This way you save a lot of money while you are spending through the card.
Short term loans
Depending on your payment patterns, the card lender always opens prospect to small loans and keep it pre-approved for you. These are just pre-approved offers which you can avail in times of urgent situations and you short with cash. This loan amount does not block your credit limit, it is a different account all together and the EMIs are added towards your statement which you need to pay on the credit card due date. This is the privilege you get only if you pay all your dues on time.
Build credit history
It can be the best tool o build or rebuild your credit history. Credit card payments contribute more to your cibil score than any other loan as this is one type of an unsecured loan. If you happened to be in a low cibil score bracket, this can be a savior for you and can help you build your credit score in no time. Having a good credit history can not only help you get a quick loan in the future, but also can help you get through to many life problems.
Owning a credit card has its pros and cons, but if you know what the cons are, you can easily manage your card and can live a good financial plan. As we all know, we should understand the terms first when we are getting into something. The same principle goes in this and you can get the best out of these cards.

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