Here are a few beginners’ tips that can prove useful:
- Pay the credit card bills on time. No exception.
- Mind your credit scores. If you feel your card details have been compromised, take it up immediately with the bank, which has issued you the card
- Pay your EMI regularly. Any default will damage your credit score and hence creditworthiness.
- Do not use too many credit cards.
- Avoid treating credit cards as easy money. This is the money you have to pay back with high interest if you make it a habit to pay only the minimum amount due every month.
- Do not buy unnecessary items just because it is available on zero credit and low EMI. Remember its money spent!
- Always try to increase your down payment when you take up a loan so that your monthly liability doesn’t eat into your savings.
Finally, credit doesn’t increase your purchasing power. It just brings future purchasing power to the present and gives you a false impression that it has increased.
Regards
Team The Equity Markets
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