Utilising free credit period: Having a credit card does not mean that you can use it carelessly and spend on unnecessary things. But, rather credit cards should be used when you already have the required money in your account. The idea is to benefit from the free credit period that these cards offer from the date of billing. For example, if you earn a monthly income of Rs. 75,000 and your expenses on groceries, ad-hoc purchases are Rs. 20,000 then you can use a credit card to pay the amount.
Later the outstanding amount can be paid out easily from the balance in your saving account. In this way, you not only take advantage of free credit period but will also earn interest rate on the funds lying in savings bank account.
Card points or bonus: Other than utilizing the free credit period, an individual can also earn bonus points or cash points on his/her purchases, which otherwise is not available on direct cash payment. A credit card holder can derive maximum advantage out of his credit card by studying the specific features of the same. Some credit card, offer points, for purchasing fuel from specific oil companies, while others offer discounts on shopping from listed brands. Additionally, bonus points earned through credit card transactions can be redeemed for important things or can simply be converted into cash.
Points to note: One should bear in mind that they keep their credit card payment track record clean. If a person defaults on credit card payments or does not use it appropriately, then it is better to avoid it.