Being smart with credit cards

There are two commonly prevalent opinions towards credit cards in India. One is the attitude held by a rapidly decreasing number who are old fashioned and view credit cards to be bad as they signify taking on of debt and paying very high interest costs. There is another attitude held by an ever increasing number of consumers who view credit cards as tool to support their financial indiscipline, leading to easy purchase of things for which they have no money leading to interest cots and penalties. In the middle is a small minority of smart credit users how use the card for their benefit and we can easily learn the techniques used by them.



The definition of a smart credit card user is one who always pays on time and never pays any interest or fees to credit card issuer. An even smarter credit card user is one who is able to secure a credit car with zero joining fees and zero annual fees. The smart users benefits from the features of the credit card to their advantage

1.  The credit card issuer provides you an interest free loan to fund your expenses
One can attempt to make all the household expenses using a credit card and pay it by the due date. Phone bills, electricity bills, grocery bills, travel expenses and entertainment expenses are some expenses which can be easily made using a credit card. If these expenses are paid on the statement due date, then these expenses turn out be purchases made on funds provided by the credit card issuer at zero interest rates. The credit card issuer is providing a zero interest loan and smart people will never leave such and opportunity.


2.  Credit card issuers offer incentives to make purchase using the card
 Is it the icing on the cake when one not only gets an interest free loans from the credit card issuer, but also a host incentives for spending on the card. Incentives accrue to the user on account of cash back, discounts and reward points offered by the issuer on the total purchase amount.

3. Credit cards offer other small benefits

• One need not carry cash in your pocket. Instead the cash can sit in your bank account earning interest, even though the interest may be a small amount.
• The credit card statement is a good way to track spending.

These are they ways by which a credit card can be used intelligently. I would be keen to know if there are other ways to be smart with the credit card.