A Brief History of Credit Card
Before using credit card we all have to know that what is credit card and how does it works. How you will use your credit card it totally depends up to you and it will give an impact to your future finance.
What is Credit Card?
Credit card is not only a pieces of plastic but more than it. It is a loan process which is given by financial organization and you have to pay the loan within their specific time. Your credit card will contain a limitation and you have to keep yourself in the middle of that limit. If you can use your credit card by your intelligence then you will able to utilize your money easily.
Three basic types of credit cards
General purpose credit cards
In such credit cards are those whose are uses for general purposes. For example we can say about visa, master card etc. If you want easy condition to pay your bill and want to expense monthly then general purposes credit cards will fulfill your needs. You have to keep in mind that you will get additional time to pay the due but if you over excess the time of paying bill then you have to be paid for extra interests.
Store cards are generally use for different shop. As an example we can say that this card is the card which you can use for your favorite clothes shop. In such card contains high interest rates. There are some stores whose are offers particularly (As an example, for first purchases you will get 15% discount). When you will open an account but you cannot contain for long time due to huge interests rate.
Traditional charge cards
Charge cards for any purchase or service you have to pay for a given period of time in one. Usually you will pay no interest, but every month you will be required to pay dues. Charge card, travel card, the card can be called entertainment. Some examples – such as American Express and Diners Club charge card.
Uses of credit card
• You do not need to carry cash or write checks.
• unexpected and emergency expenses such as car repairs or medical expenses can be used to meet.
• If ever needed, such as food, water and gas, but you do not have the money, you can buy and do.
• You will receive a written statement of all your monthly expenses on a show, so you can keep track of how much you have to spend.
• You can combine all the costs of the monthly payment can done.
• You can get purchase protection and extended product warranties.
Credit card use caution
⦁ Whatever amount you will expense, you will be responsible for that.
⦁ You could buy more than you expect its price.
⦁ If you move out of your card is exactly tailored to the management or the price you may pay for delay.
⦁ You need to set a budget and make sure that you can pay whatever you’re spending.
⦁ Impulse buying, which can break your budget.
⦁ Late payments or over limits could adversely affect your credit score.
Using credit cards responsibly credit cards offer convenience and simple way to track your spending month to month . These facilities have a lot of responsibility . Use the proper management of your cards , you create a track record that shows lenders that you know how to manage credit . Proven track record, lenders give you more stars , more loan may give credit for purchases – such as a new car or home .
That’s why you use credit cards, it’s important that either:
⦁ If you can pay your entire balance each month, it gets better and you get rid of high interest.
⦁ Make your payments on time, every time.
⦁ Keep in mind that the transaction is in the range of your card.
⦁ Do not spend more than you can afford to pay back. Consider this advice: the cost of credit card and other loans (excluding rent or mortgage payments) and 20% of your after-tax income should not be higher.
⦁ Watch out for these signs of credit trouble
⦁ Until bill you do not know how much you have borrowed.
How to deal with credit difficulties should be
⦁ Call your creditors and talk. You can get a payment schedule designed.
⦁ Stop using your credit card.
⦁ Leave a payment plan if you do not give your entire balance every month to make sure how much you’re spending, how much per month is payment and how much interest on arrears are being added.
⦁ Arrear cards quickly and responsibly to plan the first step in a better credit card management.
⦁ Credit card safety of financial institutions are continually stay ahead of criminals and to protect you. If your card is lost or stolen, you should notify the card issuing financial institution immediately.