Credit Card Points


Credit Cards, the magical piece of plastic which can buy you the world. Well that was the impression which I first had when I first saw an advert on Indian TV where Sachin Tendulkar persuaded us for a Master Card credit card. My experience with a credit card came much much later when I joined the work force and somehow took the plunge.

A credit card is basically a card which can pay for you on credit & the bank whose card you hold agrees to pay the merchant. The bank will expect you to pay later when they send you the bill. Its that simple. However in most parts of the world they have not been as successful as an ATM or a debit card which is linked to your bank account. Anyways I am not here to teach you about unsecured credit which is a minefield if you dont know how to use it but I am going to talk more about the other side of it. Reward Points !!!

All credit card companies want you to use more and more of it so at one point of time when you dont have enough money to pay back, you will pay them interest. Till then you get reward points. 

In most offerings you get you will have options like Airline miles, reward points, cashback points, hotel points etc and if you use it cleverly you can enjoy a whole buffet of privileges.
I took my first card some 3-4 years back and today I own almost 10 cards ( I know they are a bit much but then thats my game).

So the first step is to get a credit card from a bank of your choice and then start spending. I am now going to share some of the cue-tips before you just go and apply for one.

1. Never apply for a basic card - reason the point structure isnt good ever. I initially used to be a bargain hunter and get a free or a small fee card. One day one of my friends told me about the fact that a credit card company will never make enough money on the basic card so the reward points arent that great either. So open your wallet and take atleast a mid tear or if you can take a top tier card.

2. There are many banks which offer you a card, take a bank where you dont have a banking relationship like a savings or a checking account. In case of any dispute such a bank may deduct your account immediately. Rather take a card from a new bank.

3. Most domestic banks in India have been a miser in terms of credit card programs, so choose an international bank who are more generous.

4. Dont apply for too many cards at one go as it will hit your credit ratings.Fill your wallet, one step at a time.

5. Choose a card by calculating how much you are going to spend and what benefits will you drive out of the card, ask yourself if you want airmiles or reward points.

6. Begin your credit card journey with the VISA or MasterCard franchise card and not a diners club or American Express card, the latter two arent accepted everywhere and so it will not give you the full benefit till you master the art of making money with a credit card. 

So what are you waiting for, get up and be a part of this addictive journey. In my subsequent posts I will share some reviews of the best cards available in the country and how to use them for your everyday journey.

Cheers PJ...

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