Nowadays Employed people will have received calls with attractive offers from credit card companies many times a week. Credit card craze is increasing rapidly among the youth, as it gives freedom of shopping. Online shopping or offline, people are using credit cards fiercely. Even the utility bill and now through third party apps are transferring themselves in the name of house rent or other payments.
You can get stuck in debt
However, this facility of credit cards many times also implicates people in debt trap. The habit of continuously large shopping and transfer of money to itself increases debt. Such a situation also comes when a personal loan has to be taken to pay the credit card bill, which causes the credit score to deteriorate.
How much to spend
It is important to know what percentage of credit card limit should be used so that your credit score is safe. According to experts, the ideal situation is that you should spend only 10 to 15 percent of your credit card limit. If you use more than 30 percent of your limit, your credit score may be stable or may be negatively affected.
Understand by example
For example, if the limit of your credit card is Rs 1.5 lakh, then you should not spend more than 45 thousand rupees a month. In addition, it is important to keep a constant watch on your credit score. Closing your old credit card can also spoil your credit score, especially if you are not managing credit for a long time.
Use thoughtfully
Therefore, take care when using credit cards. Keep your spending limit under control and pay bills on time so that you avoid getting caught in the debt trap and keep your credit score better. Credit card is a useful financial device, but it is necessary to use it correctly and carefully.
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