There is no doubt that credit cards are the most convenient mode of payment. If you use your credit card smartly, then you may shop your heart out as well pay the bill amount with ease.
“But how?” is the big question.
First and foremost, your income defines your shopping budget. Let say your monthly income is Rs 25000 and the total expenses are let’s say Rs. 15000 (including all your personal expenses). Now you have Rs. 10000 handy. Common sense will tell you that this is your shopping budget. You would be wrong - your shopping budget is exactly double your saved amount i.e. Rs 20000.
Let me further explain how you could do it.
Let’s assume your bill statement is dated the 5th of every month and your due date is the 25th of every month. For instance, for the amount you shop on your credit card starting, say, the sixth of February, the due date will be the 25th of March, not the 25th of Feb! In the interim, you will receive another paycheck, that of March. This effectively means that you have the Rs. 10000 from February (the current month) and an identical amount from the next month’s salary to shop with.
Mind you, I am not recommending this as an idea for out-of-control shopping. I am only putting this idea across for anyone who would want to time their purchases so that they don’t end up paying a penny more than what they have spent on high credit card interest payments.
November 18th, 2008 at 12:57 pm
I always considered the 25th of the same month as the due date. Thanks for clarifying this. Now budgeting shopping is definitely going to be easy.
November 18th, 2008 at 1:01 pm
Till now i have never planned purchases on my credit card. But after reading this piece i would surely plan my purchases and pay my credit dues on time.
November 18th, 2008 at 1:08 pm
It’s a good informative piece, i had never thought of using my credit card from this point of view. I had always made purchase on my credit card without thinking or as per my needs. But now i will plan my credit card purchases.
November 18th, 2008 at 8:24 pm
So do you suggest that people should have a credit card and that too two????? Are you aware that if you miss out on one payment then the interest rate charged are going to be as high as 45% apx.
November 19th, 2008 at 7:59 pm
No Rahul thats not the point……. writer is asking us to take it easy… we have our nxt s the due date… so our nxt mnths income can help us pay the dues……..
December 3rd, 2008 at 4:52 pm
Why Intrest reate is so high in credit cards?
December 3rd, 2008 at 4:53 pm
Why Intrest rate is so high in credit cards?