How to use a credit card

Finance

How to use a credit card

Plastic bank cards, debit andcredit, have already become a familiar phenomenon and they are actively used even by pensioners. Many banks with which you begin to cooperate, by opening an account or having issued a loan, are immediately offered to issue a credit plastic card, which is quite capable of replacing a purse full of money. But how profitable is it to use a credit card?

What is a credit card?

Plastic bank cards, with which youcan carry out non-cash settlements, there are debit and credit. The debit card is tied to your current account opened in this bank, and the amount of money you can spend with it is equal to the amount that is currently in your account. A credit card is an offer of a bank, an amount that it is not afraid of lending to you. If you are new to the bank, wanting to issue a credit card in order to receive it, you should not only write a statement, but also provide some minimum information about your financial capabilities. If you already have a bank account or a loan, the bank has an idea of how solvent you are, and the initiative to issue such a card comes from it. Each card has its own credit limit, beyond which you can not spend money. It should be borne in mind that the interest for using money on such a card is much higher than what the bank will offer you if you make out a normal loan for the same amount.

When making a credit card, carefully study all the conditions of its use. In different banks, they may differ.

How to use a credit card correctly

Now many credit cards of various bankshave a grace period of credit. This means that you can use the money within the credit limit, making non-cash settlements and not paying interest for a certain period. If you return the money to the card before it expired, you will not be charged. In the event that this amount or a part of it has not been returned, the interest will be charged to the balance of the debt, and you will have to pay it off, paying a minimum monthly installment. You can repay the debt and large payments, but interest on its balance will still be charged.

Banks are currently prohibited from sendingcredit cards by mail, attracting potential borrowers, but they impose this service through the Internet. If you do not need money on credit, do not draw up a card "just in case".

Of course, there is no point in payingcredit card in the dining room or grocery store, but to spend money on large purchases, the cost of which you can reimburse on the card for two months - this is the best option for its use. Only in this case, you can take money from the bank for free with a profit for yourself, without paying the bank extortionate interest.