Mobile Phone rings Hi, I DON’T want your Credit Card…Who gave you my number? If banks are really after us to get a Credit Card, then there must be… ‘Daal me kuch toh kaala’. But if that’s the case, why did BILLIONAIRE.

Kevin O’Leary advised his son: “I told my son, as soon as you see him, Trevor … put $ 50 on the card and pay for it.” Billionaires also get credit cards, even when they don’t need them because there are some secrets about credit cards that can help you get rich.

3 Disadvantages 3 Benefits Of Using Credit Cards

1 secret advantage where this piece of plastic can help you buy a house. And finally, I’ll give you a bonus tip to help you understand how to use credit cards wisely. But first, if you like our work, make sure you break the ‘Like’ button.

Let’s begin So, you know what a debit card is right? It’s a card that deducts money from your bank account every time you use it. But using a Credit Card is like taking a quick loan from a bank and you have to repay back this money to the bank within a billing cycle, which is usually for 50 days. These 50 days are your interest-free period. Does it mean you can spend 10 Crores using a Credit Card on your first day? Not really. Your Credit Limit, i.e how much can you spend using your Credit Card is decided by the bank, based on your… Income level, Credit Score… so on and so forth. So basically, CREDIT Cards give people money that they don’t have. And that creates problems.

Problem #1: They Promote Impulse Buying. Every website you go to will show you an adv. In fact, you must be seeing one right now. It’s not wrong to buy. But when we are not in a good place mentally, just to get a quick buzz, we buy shoes we don’t need or that 5th Game of Thrones T-shirt that just lies at the back of a closet. This kind of impulse buying is pushed further when you have a credit card because, with a Credit card you don’t have to pay now, you can pay later. So, if you already have these emotional issues to resolve first, then credit cards might not be your friend. In fact, comment below and tell me what was the last purchase you made that you regret? Was it a midnight ice cream or a T-shirt you already had or shoes you didn’t need? Problem.

#2: They put you in a lot of DEBT. Interest Rate of Home Loans… is around 8%. Car Loan.. around 10. Personal Loan… around 12 Do you know what’s the interest rate of Credit Cards? Between 24 to 42% per annum. Matlab bhaiyya, if you pay back the money to the bank within your billing cycle then okay… 0 interest. But if you default by just one day, then here’s what happens. You have to pay interest not just for one day, but starting from the day you made the transaction.

Assuming you made it at the start of the billing cycle then your interest is on 51 days, not just 1 day. Late payment charges will be applied. You have to pay 18% GST on the overall interest accruing. And God Forbid, if you make a new transaction, before paying off this old amount, then this new transaction won’t have any interest-free period and it’ll start attracting interest from Day.

1. Apart from these payments, 2 solid ways that Credit Card companies make money are this… If you withdraw cash using your Credit Card, then you start paying interest right from Day 1. Credit card companies tell you… ‘Oh, so you have to pay 50,000 this month?.. Don’t worry.. just pay 5% of it. i.e the minimum amount due.. and you won’t be charged a late payment fee.’ You think it’s a boon, but it’s not. Because you will still end up paying high-interest rates on the remaining amount. So the day you get your Credit Card, Swear to God that no matter what, you will pay your dues on time, because if you don’t…

Problem #3: Credit Cards can spoil your CREDIT Score. Now, listen to this very carefully. A Credit Score is a 3-digit number, ranging from 300 to 900. This score is used by banks, credit card companies or even Insurance agencies to decide whether or not to offer you credit and what the interest rates would be. This means, if you want to do business or even have ‘Ghar-Baar-Bacchey’ in this country… then having a good Credit score is very important.. In India, there are some of the bureaus that keep track of our Credit scores, like CRIF, CIBIL. I’ll tell you more about this score later, but for now, remember that… this score should never go down. But if you don’t pay your Credit Card Bills on time… it will. You can even keep track of your CREDIT Score through apps like CRED which allow you to manage all your cards in one place and even rewards you every time you pay your bill on time. I’ll tell you more about CRED later. For now, those were the 3 problems of having a Credit Card. But just like that Gulab jamun on my Veg Thali, I save the best for the last.

So, here are the Top 4 Reasons Why Credit Cards are great…

1. Credit Cards have… Benefits. If they are charging you so much interest, surely.. they must be offering something in return first. Depending on the Credit Card you opt for, you can get benefits like. But getting a Credit Card just to get free food at Airport lounges is silly. The more important benefits of Credit Cards are…

2. They are Universally Accepted. I bought my first Credit Card in 2012 when I had to travel to the US for work, alone. It was my first international travel and I was told that Debit Cards might not work everywhere. So before I left, I bought myself a Credit Card and thanks to it, I had no issues grabbing a quick meal in between a connecting flight at Heathrow where the currency was Pounds, paying for the cab from the airport to the hotel, and checking in at the hotel where the currency was Dollars. And when I went out to see the world, it worked at all stores and amusement parks. They also work across multiple websites, whether you want to buy an online course or set up a recurrent transaction at Netflix. But if you are using them everywhere, surely safety must be a concern. This is why they also offer…

3. Strong Buyer Protection These days, we seem to make a transaction at some new website every month. The good news is, Reserve Bank of India has shifted the responsibility of proof of customer liability to the bank. This means, if you don’t get your order, you can ask the credit card company to raise a dispute against that transaction. This is called ‘ChargeBack’ and it protects you from fraudulent transactions. But read the terms and conditions of your Credit Card carefully to ensure that they do offer the ‘Charge Back’ benefit. And now is the time for the Secret Advantage…

4. Credit Cards… build your Credit Score. what Kevin O’Leary was really saying… ‘I told my Son, Trevor… put $50 on the Credit Card and pay it off.. ..and now he has got a pristine Credit Rating and he has only ever put a few thousand bucks through the card. Everybody should understand that… There is no way to game that system. You’ve got to establish your Credit Rating or you can’t borrow.’ As he said, you must establish your Credit Rating. As we discussed earlier, Credit Rating or Credit Score is a very important number and one of the ways of building it, is to get a Credit Card, use it to spend small amounts, but repay it back immediately. This repaying on time, over the years, is what will build your score. And when you have a good Credit score, this is what happens… You can get a good premium for insurances. You can negotiate the interest rate on your Credit Cards. But most importantly, you’ll get a better interest rate on your loans… be it for Education, starting a business, or to get your Dream House.

To give you an example, this house that we are staying in, has a loan on my name. I and my husband took a joint loan, but I have a better Credit Score and the bank said that the interest rate would be lesser if it was taken in my name. And that’s how a good Credit Score helped us land a good house at a good interest rate. In short, a Good Credit Score = A happy Life. Because it can help you with your education, with your business and even your house. One of the apps that help you maintain a good Credit Score is CRED.

This article is in association with them because I have been using CRED since 2019. Before I give you the Bonus Tip, let me quickly tell you about them… I’ve been a CRED member since 2019 because, in one of the talks, I heard their CEO, Kunal Shah, saying that CRED is not just an app. It’s a tribe of people who make good financial decisions. And I wanted to be a part of this tribe. I have 2 Credit Cards, American Express, and ICICI.. and I manage them through CRED. As you can see on the top, every payment gave me CRED coins, that I have accumulated since 2019. And I can go to the Store, check out the offers available and use my CRED coins to avail of these offers. I am not bragging but that is my CREDIT score. Not bad, eh?

It means that I follow what I preach, I pay my bills on time, I maintain a good score and I only promote what I believe in, or use. So read all about them and if YOU think CRED is where you want to be, then download the app using the link below, enter your name and mobile number, and CRED with automatically fetch your credit score. Remember, you can only be a CRED member only if your credit score is 750 and above. Good luck. 🙂 I think by now you know that Credit Cards can either make or break you. So to use them wisely, I am going to give you a simple… The Urban Fight copyrighted formula. While using Credit cards, remain… SANE. Chadar jitni hai, pair utney hi phailao. You are not taking Credit Cards for money, but to build your Credit Score. Auto-debit helps you from falling into the hell hole of… paying interest, taxes, late fees, and getting a bad Credit Score. Because, why? Extensively research your Credit cards. Annual Fee, Interest Rates, Hidden Charges, Credit Benefits and read the Terms and Conditions carefully. The job of an agent is to just sell you a Credit Card, it’s your job to find out whether that Credit Card is useful for you or not. So today’s Bonus Tip is this. While using a credit card, remain SANE. Because that’s the only way to use Credit Cards wisely.