Credit Card Tips: If you are getting a credit card for the first time, this news might be especially helpful for you. Reading this news can be very beneficial. Be aware that getting a card without careful consideration can turn a seemingly good deal into a headache. To choose the right first credit card, it’s essential to know nine important things so you can avoid significant losses.
Understand your spending habits
Before getting a credit card, it’s crucial to understand your spending habits. Instead of chasing every tempting offer, choose a card that fits your needs. If you mostly shop online, get an e-commerce-friendly card. If you travel frequently, choose a travel card. Never change your habits to suit the card.
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The right math of reward points
Many people consider cards with more reward points to be better, but what’s important is the cash value of each point. Cards with fewer points can sometimes offer more profitable redemption values.
Pay attention to category bonuses
Some cards offer up to 10-15% returns on specific spending categories such as bill payments, food delivery, or petrol. Therefore, you can increase your savings by choosing a card based on your highest spending category.
Properly assess fees and waivers
Annual fees can often be a problem for first-time users. Many banks waive fees after a certain amount of spending. Check if your usual spending reaches that limit. Trying to save on fees by making unnecessary purchases is not wise.
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Don’t fall for milestone benefits
Bonus points or vouchers offered for fixed spending are only beneficial if they can be easily achieved. Disrupting your budget to meet milestones can be very costly.
Be cautious of free perks
Features like free movie tickets or airport lounge access seem attractive, but for first-time users, the right reward structure and lower fees are more important. The Importance of Customer Service
In situations like fraud or a lost card, bank assistance is crucial. Good customer service can save you both time and money.
Get your first card from your salary bank
When applying for a credit card for the first time, applying with the bank where you have your salary account is the safest option. Applying to multiple banks repeatedly can lower your credit score.
Pay your bills on time
Credit card interest rates are often between 36% and 42% per year. Therefore, paying your bills on time is extremely important. Failing to pay your bills can lead to a debt trap.