Avoid falling into a Credit Card trap

Most of the people have moved on from paper money to plastic money. Most of them feel great when they use their credit card instead of paper money. We are not aware that 1% to 4% of the revenue generated by bank are from the interest we pay towards the credit card we use. Below i will help you out with the list of things you should be careful while using your credit card.

1. Minimum Amount due: Everyone must have used a credit card and would have got a statement for the outstanding amount to be paid within a specific duration as given by the bank. There are 2 sections of payment, one is total amount due and another is minimum amount due. Most of the new users do not check the Total amount due on their bill and only see the minimum amount due. Because of this people fall into the trap of interest which they need to pay in their next bill along with the purchases they make next month. I would request not to make the payment of Minimum Amount Due as you will be liable to make the payment of interest charged by the bank for not making the Total Amount Due.

2. Easy Monthly Installment (EMI): Rather than falling into making the minimum amount and paying the interest for it, i would suggest you to switch to EMI facility if it is available with your bank on your credit card. Now a days all the Banks are giving an option to convert the purchase amount into an EMI. To opt for an EMI please check the limit with your bank as they have some conditions for it. Also some banks are providing an EMI facility that too with out interest for 3 to 6 months(depends on banks)

For instance: With my credit card bill i received a brochure of getting an EMI facility on some selected brands/ dealers. Hence, I bought a washing machine for rs.10,000/- from one vendor. I called up the customer care of my bank and asked them to convert that transaction into an EMI. Now if i convert the transaction for 3, 6 or 9 months there is no processing fee which depends on banks according to months. Hence I opted for 6 months EMI according to my affordability. So now the EMI every will be 1666.66/1666.67 per month till 6 months with out any interest. But make sure when your bill generates make the total amount outstanding as per the statement, else will be charged interest for making the minimum amount due if you have any other transaction apart from EMI.

3. Cash Withdrawal: Many of customers think that this facility is provided by the bank to withdraw cash. Yes they are correct, but they are not aware that the charges for Cash Withdrawal starts from the time you withdraw cash. There is a one time transaction fee for withdrawing the cash which may by from 2.5% to 4%. Apart from a transaction fee there is also 33% to 40% interest charged annually(2.8% to 4% per month) at the time of bill statement. For more details regarding Cash witdrawal fee, do check the information provided on Moneycontrol.

4. Interest & Fees: Banks do sell a credit card after all verifications required and we accept the same however we not only accept the Credit Card but we also accepts some interests and fees. Many of us are aware Joining fees, renewal fees, interest charges and service charges but there are some charges like Late Payment fees, Cash Advance Trasaction fees, Over-limit charges, Fees on Cash Payment at branch, Outstation Cheque fee, Duplicate Statement request(more than 3 months), Card Replacement, Cheque or Card pickup, Chargeslip request.

So in all would like to recommend you to read the terms and consition before getting into buying any credit card. Now a days all banks do give a verification call after you recieve a new card and inform you about the features and charges of the Credit Card you hold, hence you can clarify your doubt on phone with them and take necessary steps. Also a suggestion to always check your current Card bill/ statement and make the full payment rather than going for the minimum payment to avoid charges. Always make the payment on time or before to avoid Late Payment charges. Also consult your customer care executive on phone or in bank about the pros and cons of cash withdrawal facility.

I Hope now most of us will not have a problem regarding using a credit card freely and easily.

image source: image1:http://www.bubblews.com/assets/images/news/359378494_1373469480.jpg, image2:http://www.pinelabs.com/images/EMI.jpg, image3:http://img.allvoices.com/thumbs/event/609/480/93226434-atm-cash.jpg

Lost your Wallet? Things to do quickly

Many of us must have faced a lot of distressing moments by getting their wallets lost or stolen by robbers. You have many valuable things in your wallet and you don't want to loose them. Here are some simple steps you can do to minimize the damage that will be caused by wallet getting stolen or lost.

Plastic Cards: As soon as you come to know that your wallet which carries Credit and Debit cards has been stolen or lost, you should immediately call the customer care service of your bank and cancel all your cards. Such immediate reaction will help you to lower the damage. Though you may not be charged for the fraudulent charges that are made on your cards but taking it as a responsibility to report the cards missing or stolen.

Reporting to Police: You should always report the Police about the loss of your wallet. There might be a possibility that others might use your personal details or cards for various things hence if you report to the police and get the complaint number or a copy of police report that might help you a lot in many things. Also suppose if your credit card is misused then the police can intervene and stop the frauds that might happen in future.

Intimate the Financial company: Do intimate your bank about your wallet been lost or stolen. They will update their records and see to it no fraud happens on your account. Also monitor your bank accounts daily activity for some period of time till every thing has been taken care off. Also request for the new PIN as you might need to change it if you have left such things in your wallet. Also inform the Insurance company about the theft or loss of wallet as that might keep you insured if something wrong/ fraud happens on your account.

Credit Bureau: It is very important to call and inform the credit bureaus if you had left any personal information or SSN or Social Security card inside your wallet as you wont like to be a victim of identity theft. The Credit Reporting agencies(Equifax, Experian or Transunion) will place a restriction on your account. Suppose if the financial institutes gets any request for credit card or opening an account with your personal details, they will first call you to check or verify whether it was you or not who made such request.

Carry less: It is always said to carry less things in your wallet so that you don't loose everything at once. Suppose if you have all the photo identity proof along with you in your wallet and it gets lost, then you might loose your identity. It will take a lot of time and money to get all your photo identity cards back. Hence its always suggested to carry less or just carry whatever you needed at that particular time rather than carrying everything and loosing it. Government documents actually requires to go through a formal application where you have to provide a photo id. For such reasons its good to carry not carry all the identification along with you in your wallet.

Finally its very essential to carry less and note everything you have in your wallet if you loose your wallet. The loss of Wallet is very stressful hence take the necessary steps as seen above which might help you in future. “An ounce of prevention is worth a pound of cure”, so carry your wallet in a safe place like a wallet or keep it in your bags or inside a purse for women where they are not easily reachable.

Image source: http://www.iclickfun.com/wp-content/uploads/2012/05/stealing-wallet.jpg,

http://australia.creditcards.com/credit-card-news/images//cancel.jpg,

http://www.buzzle.com/img/articleImages/472488-12428-7.jpg,

http://nation.foxnews.com/sites/nation.foxnews.com/files/styles/dv1/public/636_062912_fx_wallet.jpg