Is your credit card debt growing? These Smart tricks will make you financially strong
Getting caught in the cycle of EMIs, minimum payments, and high interest rates puts people under financial stress and damages their credit score. However, with the right approach and expert strategies, a credit card can become a tool for financial stability rather than a source of debt.
Don’t utilize your entire credit limit: According to experts, you shouldn’t use more than 30% of your credit card limit. Excessive use increases the credit utilization ratio, which negatively impacts your CIBIL score.
Always pay your bills on time and in full: Paying only the minimum amount due might seem easy, but it’s the biggest mistake. This leads to rapid accumulation of interest. Paying the full bill every month helps avoid interest charges and keeps your score strong.
Avoid having multiple cards: Having several credit cards at once makes it difficult to control your spending. Keep only one or two cards as needed and use them responsibly.
Avoid cash withdrawals: Withdrawing cash from a credit card incurs heavy interest and additional charges. Never do this except in emergencies.
Use EMI offers wisely: No-cost EMI offers seem attractive, but converting every purchase into EMIs is not advisable. This pre-spends your future income and increases your debt burden.
Regularly check your credit report: Check your credit report at least once a year. This helps you detect any errors or fraud in time and gives you an opportunity to improve your score.
Don’t close old cards: A long-standing credit card strengthens your credit history. Closing an old card without a valid reason can lower your score.
