How to use credit card to save money | beginners Guide
Using a credit card wisely is important for building a good credit score and avoiding debt. Here’s a beginner’s guide to using your credit card effectively:
1. Pay Your Bill in Full Every Month
✅ Always pay the full amount due, not just the minimum amount.
✅ This helps you avoid high interest rates (36-48% per year!).
✅ Set up auto-pay so you never miss a due date.
📌 Tip: If you can’t pay the full bill, pay at least the total statement balance to avoid interest.
2. Keep Credit Utilization Below 30%
✅ If your credit limit is ₹1,00,000, try to spend only ₹30,000 or less per month.
✅ Keeping utilization low boosts your credit score and makes you eligible for a higher credit limit in the future.
3. Use Your Card for Everyday Expenses (But Stay Within Budget)
✅ Use it for groceries, fuel, dining, and online shopping to earn cashback and rewards.
✅ Treat your credit card like a debit card—spend only what you can pay back.
📌 Tip: Don’t use it for unnecessary luxury purchases unless you have a plan to repay.
4. Choose the Right Credit Card Based on Your Spending
💳 For Online Shopping: SBI Cashback Card (5% cashback)
💳 For Amazon Users: Amazon Pay ICICI (5% cashback for Prime members)
💳 For Travel: HDFC Regalia (lounge access, travel rewards)
💳 For Dining & Movies: HDFC Millennia / Axis Neo (discounts & cashback)
📌 Tip: If you spend across multiple categories, consider using two credit cards to maximize rewards.
5. Take Advantage of Offers & Discounts
✅ Check your bank’s app for special discounts on Flipkart, Amazon, Swiggy, Zomato, MakeMyTrip, etc.
✅ Use No-Cost EMI for large purchases to avoid paying extra interest.
✅ Redeem reward points for travel, vouchers, or bill payments before they expire.
📌 Tip: Follow your bank’s website or app to stay updated on offers.
6. Avoid These Costly Mistakes
❌ Never withdraw cash from an ATM using your credit card (High fees + interest starts from Day 1).
❌ Don’t miss a payment—late fees + interest can pile up fast.
❌ Avoid impulse spending—a credit card is not free money.
7. Track Your Expenses & Credit Score
✅ Use Cred, OneScore, or your bank’s app to track spending.
✅ Check your CIBIL score (750+ is ideal) to qualify for better loan and credit card offers.
Final Thoughts
A credit card is a powerful financial tool when used wisely. Focus on on-time payments, cashback, rewards, and discounts to maximize benefits.
💳 Need help choosing the best credit card for beginners? Let me know! 🚀