things you should know before you get your first credit card

In today’s age of digitalization, making payments either through debit or credit cards is become trending. Everyone is going cashless while going for shopping, dining, traveling and for more. In the financial market, credit card is one of the handy products that are available. These tiny plastic cards can be very useful if used in the right way. 

There are large numbers of advantages of credit card such as rewards, traveling, cash back, discounts, handling emergencies or unplanned expenses and so on. Using the credit card into a right way and paying the bills on time can help in building your credit score and also be beneficial while traveling. 

Which mistakes that one should avoid while taking cards?

Are you going to take your credit card? So, there are some factors that you should know before applying the card-

• Taking too many cards

Having too many cards increases your chances of over spending and even can get you into a big debt trap. As each card application has the potential to knock points off your credit score. If you apply for several credit cards within a short period of time, you might notice the denial are more frequent as lenders start getting suspicious about the sudden attack of credit card applications. So, it is advisable to apply for a new credit cards one at a time as per your needs not because of the privileges and unmatched benefits of the credit card. Having a lot of credit cards can have a negative impact on your CIBIL or credit score.

• Avoid to close your credit card account 

Closing your credit card account will infrequently get you anywhere with your credit card issuer. As you drive your credit utilization up then, it will almost always cost you credit score points. So, try to leave credit card accounts open until you're sure closing your card account won't hurt your credit score.

• Maxing out your credit limit

Charging your card balance beyond 30% of your credit limit is risky to your credit score. Because getting close to the credit limit puts you at risk for over-the-limit fees and penalty interest rate. The credit card charges when you exceed your credit limit. So, it is advisable to maintain a good card balance for a healthy credit score and manageable payment amount. 

• Making minimum payments or missing monthly bills

Paying the minimum credit balance can earn interest over time. Similarly, paying the bills late means low credibility and low dependability which affects your monthly credit limits.

To know more about credit card, visit https://www.applykaroo.com/credit-cards.