Apply for Credit Card!
Credit Cards have become an essential financial tool today. They have enabled seamless transactions for purchasing goods and services, both online and offline. But you can also effectively save money by reducing your expenses by using your Credit Card smartly. Read on to know more.
How to reduce your expenses with a Credit Card?
(1) Choose the right Credit Card
Track your past shopping history to understand your spending habits (where you have spent the most) and create a budget for future expenses. Additionally, look for low Credit Card interest rates to check which card suits your needs. Then, choose a Credit Card that offers rewards for your frequent purchases. For example, if you often travel, opt for cards such as the Axis Bank Vistara Credit Card or the Axis Bank Atlas Credit Card. These cards offer benefits such as complimentary air tickets and reward points in the form of miles. Since Credit Card offers and benefits are subject to change, make it a point to check the prevailing offers before selecting your Credit Card.
(2) Use Credit Cards for regular purchases
Frequent purchases can increase your reward points and help you earn more discounts. Many online shopping websites offer discounts or cashback when you pay using a Credit Card. Keep an eye out for these offers. You may also get loyalty points / cashback if you use the card beyond a certain limit each month. Additionally, you can manage your spends and meet milestones to avail benefits such as annual fee waiver (if applicable). Hence, understand these rules in detail when applying for a Credit Card.
(3) Take advantage of EMI facilities
Most banks offer EMI (Equated Monthly Instalment) options for large purchases. While this isn't a direct savings method, it can help manage cash flow. You can make necessary large purchases using the EMI facility. Always compare the EMI interest rate with potential returns from your savings to ensure this strategy is beneficial.
(4) Pay bills regularly
Paying only the minimum due amount on your Credit Card each month might not be the best strategy. Always try to pay the total amount by the due date to avoid interest expenses and late payment penalties. Your Credit Card utilisation ratio, which is the amount of credit you are using compared to your total available credit, can significantly impact your credit score. Aim to keep your utilisation ratio below 30% to maintain a healthy credit profile and avoid potential interest charges that could hinder your savings.
Also Read: How to get a Credit Card without bank account? - 5 Easy steps
Conclusion
Always use credit responsibly and prioritise paying off your balance in full each month. With discipline and smart planning, your Credit Card can become valuable in your financial toolkit, helping you save money and achieve your financial goals.
Disclaimer: This article is for information purpose only. The views expressed in this article are personal and do not necessarily constitute the views of Axis Bank Ltd. and its employees. Axis Bank Ltd. and/or the author shall not be responsible for any direct / indirect loss or liability incurred by the reader for taking any financial decisions based on the contents and information. Please consult your financial advisor before making any financial decision.
