Credit Card can proved to be boon, if used properly

New Delhi: Credit cards are always treated as synonyms to the debt trap. This is a misunderstanding. If the credit card is used as an asset then it can help you maintain your financial health. Here are a few things you should know about credit cards.

Credit card holders refrain themselves from increasing the credit limit- It creates fear that increased limits will encourage them to spend more and later get into the debt trap. However, they do not understand that if used carefully,, an increased limit can help improve their financial credit score and also meet immediate financial emergencies.

Credit cards can harm your financial health: Many of us avoid applying for a credit card with the fear of falling into a debt trap. However, irresponsible usage can land you in a debt trap. Therefore, if you use credit properly, you will never fall into the trap of debt. Those who are using a new credit card can create a better credit history.

Old credit cards must be closed to improve credit scores- Closing your existing credit cards can result in savings, as this will cut annual or new fees. However, use the card according to your need. Also, closing any of your credit cards reduces your total available credit limit.

Credit cards with annual fees / new fees are preferable: Zero Fee credit cards are preferred by many. For example, shopping cards give more benefits on groceries, lifestyles and other retail expenses, while fuel credit cards offer higher discounts and cashbacks on fuel transactions. Similarly, travel credit cards consistently give travellers more rewards, cashbacks and discounts on travel, hotel stays and meals.