Writer's Journal
Smart Way To Use A Credit Card.
Subtitle: A Unique Strategy Decoded for Credit Card Users
The age group 25 or 30s is very vulnerable because incomes are limited, but dreams are unlimited. In that tug-of-war, unique ideas pop up in the mind, either to increase your income by any means, or to hold patience at any cost, or to extend the payment day on your credit card. A credit card gives a maximum of 50 days' credit. Here, the problem is that if you fail to pay the amount on the given day, they charge exorbitant interest, and many people I have seen get trapped in the web of credit card loans, it has a spiralling effect, the outstanding amount goes on with interest by leaps and bounds before you even know it, then another loan is taken to pay up the existing loan of the credit card. This way, it takes you to the land of bankruptcy; from there, it is almost impossible to return to normalcy. A couple of times in my youth, I almost fell into the trap of a credit card loan before I realised my outstanding went up to a staggering amount. I saw it and thought momentarily that I had gone to the point of no return. How will I repay the loan and all? though the original loan amount was not so big, my salary at that young age was low, but within that limited capacity I used to spend on “WANT” because keeping away from those liberty that I took was impossible, as I am not God, I am like any other common young man, eager to spend like others but controlled myself to a large extent, yet how long? I had to take a salary advance from my company to meet this financial obligation. Because of this, I was tight- fisted for a few months. This self-imposed discipline taught me how to balance between frugality and fun. Since that time, I changed my credit card usage; now I use my credit card and enjoy a full 50 days' credit. How? Suppose my bill-generating date is the 25th of every month, and my due date for credit card payment is the 15th of every month. Now, if I spend anything on my credit card on or after the 25th of every month, then my due date comes the month after, the next month's 15th. As an example, this is July, I spend on my card on or after 25th July, then my next month's statement will show the expenses on 25th July or after to be paid on September 15th. Thus, I can enjoy 50 days' credit. This way I have regularised my credit card payment date to the 15th of every month. Now it has become my habit, and the outstanding has become a past story.
I believe those who are spendthrifts can manage their card payments by enjoying a full 50 days' credit with discipline. It will be a great relief for them.
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But personally, I am against taking a loan against a credit card. Why is a loan required? If someone in the family is sick and needs medical assistance or treatment, or if someone is getting married, taking a loan for education or to buy a house makes sense, but not for luxury items or foreign trips.
Key Takeaways:
- Time Your Spending: Use your credit card on or after the bill-generating day to enjoy the interest-free window up to 50 days.
- Make Full Payment: Always pay the full dues before the last day of payment to avoid spiralling high interest on your outstanding amount.
- Avoid Taking Cash Advance/Credit Loans: Do not use credit cards as a source of high-interest loans for non-essentials. Use it only for planned monthly expenses.
- Practice Discipline: A credit card is a plastic card, not free money; always use it with a clear repayment plan.
It was a small personal experience, and I wanted to share it with my avid readers.
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