People often stay in a constant dilemma between their needs and wants. However, it is overwhelming to think about the amount of money they may require for meeting both ends. You may also face the same dilemma at times, and without proper knowledge, end up spending exorbitant cash. This habit can undeniably create a hole in your pocket.
Here, using credit cards can be a benefit-driven option to make both high-end and regular purchases affordable. Opting for credit card payment gives you the power to spend with proper cash flow management.
The following points will clearly explain how making payments using credit cards can help you save more:
Rewards and cashbacks
Many financial institutions offer credit cards with attractive reward points/incentives. Thus, shopping with these cards can fetch the buyers lucrative reward points. You can use this advantage to save a considerable amount on those big-ticket expenditures.
Redeem these accumulated reward points to receive cashbacks or upfront discounts for making those overpriced purchases affordable.
Making a credit card payment can also give you the benefit to have refunds on items purchased if there’s a price drop. The lower-priced item should match with the one you bought under a specified period.
All you need to do is submit a price protection claim form along with required supporting documents to get the reimbursement.
Easy-tracking of monthly expenditure
You can track all the monthly expenses when you spend using a credit card. This can manage your cash flow especially in those months where expense skyrockets the threshold budget. Furthermore, you can also have a financial discipline by tracking those monthly transactions.
From comparing expenses per month to budgeting, everything can be sorted when you use credit cards for shopping, thereby, saving more.
Some lenders provide easy EMIs or No Cost EMIs on shopping at their partnered retail shops and e-commerce sites. For example, the Bajaj Finserv RBL Bank SuperCard comes with such advantages.
Apart from this, you can also convert your bills into affordable EMIs for purchases above Rs. 3000. Pay at your convenience within the available tenure given by different lenders.
The advantage of grace period
A flexible grace period is another advantage of using a credit card for shopping. You can defer the payments till the bill’s due date. NBFCs like Bajaj Finserv offer a convenient grace period of up to 45 days for comfortable repayments.
The lending institution also provides pre-approved offers on credit cards, personal loans, business loans, home loans and a host of financial products and services. This tailor-made scheme not only eases the process but also saves ample time of consumers. You can check your pre-approved offer by entering a few required details online.
Increased spending ability
Credit cards provide users with additional convenience to purchase anything as and when required. Studies suggest that 58% millennials use these cards to pay for most of their purchases. You too can use this financial tool if you have a lot of monthly expenditures. From buying a flagship phone to purchasing a refrigerator, pay for hefty expenses without compromising your savings.
Therefore, making a credit card payment instead of debit card or cash is a feasible option, giving you the ability to spend on big to regular purchases.
Theft protection is an embedded benefit of these cards. This feature generally covers the loss against any theft and accidental damage for a limited period. So, you can claim for a refund if you face such unwanted situations in the future.
Amends credit score
Lastly, you can improve your credit/CIBIL score if all the dues are cleared on time after shopping. This disciple also paves the way to avail future credit during emergencies without much trouble.
However, you need to be aware of a few pitfalls to avoid debt. To be precise, don’t overspend as it may increase the credit utilisation ratio. This, in turn, may hurt your CIBIL score and even drag you into debt. Additionally, try to pay the outstanding dues in full each month or else you may attract a higher rate of interest.
Hopefully, you got an overview rounding up all these factors. So, calculate each step to make all your purchases rewarding. You may also opt for co-branded credit cards to save more with every swipe.
Gaurav khanna is an experienced financial advisor, digital marketer and writer who is well known for his ability to predict market trends. You can find Gaurav on Linkedin.