How to use your credit card?

"You went for a date with your partner in a posh dining restaurant. Right after you finished your meal, you asked for the bill. The French waiter came with the bill on a silver platter, and you tossed your plastic gold on the plate. The waiter swiped it, and you signed your receipt and off you go~"

That's how easy credit card can be! Swipe and go, no need to pay by cash. But if you pay after due date, bank will charge you interest of average 15% of your amount. If you owed $5000 outstanding, you will be charged $750....Just because you did not pay on time you will be charged $750 for nothing!

So what am I saying here? Don't use credit card? No such thing!
You still use credit card~ well, use it wisely. If you know which credit card to use, you can in fact save your money!

There are a few criteria to review before you consider using credit card (Note: The banks mentioned below may only be applicable in Malaysia only):-

• Pay your credits on time. Very obvious that you should pay on time to avoid creating debts and got charged on interest for nothing. This requires a good habit/discipline, for sure its a hassle to always pay the bill every month, however do you want to waste your money for the bank interest??

• Look for card that offer cash-back or rebates. As you swipe your card you will receive a certain percentage of money to be returned back to you, this means you saved more money by using credit card. Eg. Alliance Bank Classic card offers rebates from 0.5% to 1.2% for monthly spending of RM1 to RM1,000. UOB ONE classic card offers 2% cash rebate on grocery shopping in Tesco, Giant and Carrefour AND 2% rebate on petrol purchases at any BHP stations.

• Card that offers 0% instalment plans. Sometimes you may buy stuff that's expensive. Don't worry just swipe your card, as long as it offers 0% instalment rate. Just make sure you pay your monthly credit before due date!  Eg. Citibank credit card offers 0% instalment on a selected list of merchants; and instalment tenure can be 6,9 or even 12 months.

• Look for reward points on issuer's card. Most people are attracted by this, the more you swipe the more points you will get. And you can redeem rewards from the points you have accumulated. But my suggestion, don't swipe for the sake of the points. Swipe for things that you REALLY need, if you don't need it don't bother to swipe. Because this is a strategy from the bank to make you spend more! Eg. Issuers like HSBC, Citibank and EON bank credit cards offer variety of items to be redeemed from the points accumulated.

• Waive annual fee. Some credit card issuers charged annual fee for the credit card you own. Look for banks that are able to waive your fee, so that you will not be charged at all for the card you use. Eg. CIMB MasterCard and Ambank's platinum & gold cards offer free for life waiver.

• Discounts and privileges for card owners. This part is where you save money. Issuers offer discounts on dining restaurants, hotels, travels or even shopping. So here's where you have to target on which card to help you save more often. Eg. HSBC SmartPrivileges offer 70% discount off normal-priced product of 138 selected merchants and CIMB Bank Smart Rewards gives 30% discounts on 120 merchants chosen. 

• Some cards offer free flight benefits. If you travel often, look for cards that offer benefits for traveling. The concept is that for every flight you took, you will be awarded with mileage points. After you accumulated enough points, you may be entitled to redeem a flight ticket for free! Eg. KrisFlyer American Express Gold Credit Card offers such service for flight originating from Malaysia, each RM2 you spent you will earn 2 KrisFlyer miles. Collect enough you get free flight reward!

Therefore, are you able to find some benefits that your card can serve you? Utilize it, because banks are offering it generously. And remember, never ever get caught on interest rates, happy swiping! =)