How to Use Credit Card Wisely and Effectively | HDFC Bank (2024)

FAQs

How to Use Credit Card Wisely and Effectively | HDFC Bank? ›

Avoid maxing out on your credit limit every month. Monitor your Credit Card transactions regularly to notice specific patterns in your spending. Keeping track of your spends will also ensure that unexpected transactions come to your notice and you can point them out to your bank immediately.

Pay your balance every month

Credit card balances should be paid on or before the due date. Paying the balance in full has great benefits. If you wait to pay the balance or only make the minimum payment it accrues interest. If you let this continue it can potentially get out of hand and lead to debt.

1. Pay off your balance every month. Avoid paying interest on your credit card purchases by paying the full balance each billing cycle. Resist the temptation to spend more than you can pay for any given month, and you'll enjoy the benefits of using a credit card without interest charges.

Paying your bill in full, on time, every month ensures that you will never pay interest on your purchases. A great way to make sure you never miss a payment is to set up automatic payments from your checking account.

Smart credit card users make sure to pay their bills on time and in full each month. #4. Keep balances low: Another key to using credit cards wisely is keeping balances low. This can help keep your credit utilization ratio in check, which can positively impact your credit score.

The 5/24 rule states that if you have been approved for five or more credit cards in the last 24 months, you will automatically be denied for any Chase credit card products. This is to prevent consumers from applying to credit cards solely for the welcome bonus and closing the account before the annual fee comes due.

What is the 15/3 rule? The 15/3 rule, a trending credit card repayment method, suggests paying your credit card bill in two payments—both 15 days and 3 days before your payment due date. Proponents say it helps raise credit scores more quickly, but there's no real proof. Building credit takes time and effort.

What is the biggest mistake you can make when using a credit card? ›

Not paying on time

But it's best to always pay at least part of your credit card bill on time. Missing or late credit card payments can have a big impact on your credit score and fees.

The 2/3/4 rule: According to this rule, applicants are limited to two new cards in a 30-day period, three new cards in a 12-month period and four new cards in a 24-month period. The six-month or one-year rule: Some issuers may only let borrowers open a new credit card account once every six months or once a year.

To make money with credit cards without getting into debt, always pay your balance in full each month to avoid interest charges. Use your card for everyday purchases to earn rewards and cash back, and take advantage of sign-up bonuses and promotional offers.

You can request a cash advance from an ATM that accepts your credit card's payment network (Visa, Mastercard, American Express or Discover). To get an advance, you'll need your physical card and a personal identification number (PIN), which you can get from your card issuer.

Please see your cardholder agreement fee schedule for more information. 6 Wisely Direct by ADP is not a credit card and does not build credit.