Credit cards are one of the most powerful financial tools. It provides you with instant access to credit, increasing your spending power, while also helping you enjoy an array of discounts, cashback, and other exclusive offers.
Sadly, even today, credit cards remain one of the most underused financial products. The vast majority of credit cardholders use it only for paying bills or for emergencies. This is a lost opportunity, as cardholders don’t utilise it to its maximum potential. Regardless of whether you already own a credit card or planning to apply for a new one, we've got some handy tips to help you leverage the plastic card to your advantage.
Additional Reading: How to Manage Credit Card Spends
Tip #1: It All Starts with the Right Card
Choosing the right credit card that works for you is the first step in maximising your card's benefits. However, this is easier said than done. With dozens of credit cards on the market, how do you pick the right one? Let’s make it simple for you:
Before choosing a credit card, make sure that you understand all its benefits and features. If you already own a card, visit the card issuer's site to see all the rewards, loyalty points, and other offers on the credit card.
Make sure to subscribe to the card issuer's newsletter so that you stay in the loop regarding the latest offers, seasonal discounts, etc.
Analyse your lifestyle and choose a card that offers you the maximum rewards and benefits you're likely to use. For example, if your credit card focuses on fuel rewards, but you don't drive your car regularly, this card is not the right choice. If you're a frequent flier, you need to look for a credit card with tie-ups with airlines, hotel chains, or travel booking apps.
As always, you need to read the fine print. Ensure that you're aware of the annual fees, late charges, and other miscellaneous charges so that you're not in for a shock later on.
Shop around and compare cards from different banks to find the right one for you. CreditMantri makes it super easy to find the right credit card. You can filter cards based on features, bank, and fees to shortlist and check your eligibility within just a minute. Give it a try here.
Tip #2: Be a Smart Shopper
Okay, now you know the ins-and-outs of your card, understand how the loyalty program works, and its benefits and features. The next tip is to leverage these benefits to your advantage.
You need to actively use your credit card at every place and every instance, if you want to earn the maximum rewards. For example, if your card offers cashback on online shopping, then pay for all your online spends using this card. On the other hand, if your card provides extra rewards on fuel purchase, then you need to proactively use the card every time you fill your car or bike. Similarly, if your card offers additional bonuses when you shop with a particular brand or portal, make sure to do so to maximise the rewards you earn on it.
The idea is to understand how you can earn rewards on your card and use it religiously to earn maximum rewards. When you do so, you can notice that the rewards and savings you make will double in no time.
If you're worried that the low credit limit on your card is not enough to power your day-to-day spending, then you can request your card issuer to increase the available limit. Alternatively, you can settle the outstanding balance on your card more than once a month. This way, the available limit on your card is redeemed, and you can continue using it for your purchases without having to wait until the end of the billing cycle.
Tip #3: Look for a Card that Aligns with your Spending Patterns
You can earn more loyalty points and cashback on your credit card when you analyse your shopping behaviour. For example, if you're a frequent shopper, look for cards that offer maximum reward points/cashback to shop at retail brands and outlets. On the other hand, if you primarily use your card for groceries and other utility bills, then look for a card that offers additional cashback and rewards on these categories.
Additional Reading: How do beginners use credit cards?
Tip #4: Make the Most of Promotional and Seasonal Offers
Credit card issuers often offer seasonal and promotional offers during particular times of the year like festivals, New Year, Christmas, etc. Credit cards offer double reward points or extra cashback as an incentive to shoppers during these promotional periods. If you're planning a big purchase, wait until the promotional offer is announced so that you can enjoy maximum rewards on it.
Tip #5: Redeem your Reward Points before Expiry
You have used your card smartly and accumulated tons of reward points. The next step is to ensure that you redeem the reward points before they expire. A large number of credit card users do not track their reward points regularly, letting them expire. This is a failed opportunity. So, make sure to monitor your loyalty account periodically and use the reward points before they expire.
Tip #6: Finally, Use your Card Regularly
You may have one or two great credit cards with a ton of rewards and benefits. But, if you occasionally use it, you're not likely to enjoy the maximum rewards on it. To get the most out of your card, you need to regularly use it for your day-to-day spending – both online and offline. So, don't be afraid of swiping your card and use it regularly.
Credit cards are a great way to earn loyalty points, rewards, discounts, cashback, and other offers. However, remember that you need to make the bill payments in full and on time to avoid incurring interests and steep late penalties. Missed or delayed payments can bring down your credit score, making it difficult to avail loans and credit cards in the future. Make use of these six smart tips and get the most out of your credit card. So, wait no more! Find the best credit card offers for you and apply online with CreditMantri.