Every coin has two sides. It depends on how you use it. For instance, if you use technology the right way you create more gadgets and make life easier. Free Online Financial Advisor. But if you use technology the wrong way, you create atom bombs and nuclear bombs to kill people in wars like what happened to Hiroshima and Nagasaki in World War II. On 6th August (Hiroshima) and 9th August (Nagasaki) in 1945, the two major industrial cities of Japan were bombarded by America. Now that’s the wrong usage of technology, as it killed and injured millions of people.
Depending on how you use credit, credit is a great tool. Good credit can help you get loans in the future like Education Loan, Home Loan, Car Loan, etc. But bad credit can diminish the chances of getting loans. So it all depends on how you use it. People, in general, enjoy myths and believe them. There are some credit myths which you should never believe (and stop believing,) India’s First Free Online Financial Advisory, Moneymindz
1. Debit cards build credit
Debit cards don’t build credit for the simple reason that they themselves are not credit. By definition, credit is a measure of how well you borrow money. You use a debit card to withdraw money from a connected account, you aren’t borrowing money. If you want a good credit score, get a credit card that doesn’t charge annually and use it with utter responsibility.
2. You have to carry a balance on credit card
This isn’t necessary. If you don’t pay your credit bill completely, you have to pay unnecessary and hefty interest on what you buy. Your credit utilization will increase. Pay off your balance regularly. If you do so, future lenders will be assured that you will repay the money on time. India’s First Free On call Financial Advisory, Moneymindz
3. If you have a budget, you don’t need credit cards
Budgeting has nothing to do with credit cards. Don’t assume you can easily pay everything by cash. You may still require good credit in future, so it’s better to have a credit card. All you need to do is pay your balance in full each month and avoid late penalties. You have to ensure you buy using credit cards what you can afford to repay later on. Then pay off the balance each month completely.
4. Close credit card to increase credit score
If you remove credit history by closing your credit card, you actually end up negatively impacting your credit score. Each time you close an account, you increase your debt-to-credit ratio by lowering your amount of available credit. Keep your old credit cards open and active. Use them and pay off immediately. Smart Financial Advisor, Kuber Mindz
Don’t believe in myths. When you get access to information, cross check it and verify if its true.
You can find more information about credit cards and credit with us. Just visit www.moneymindz.com or give a missed call to 022-62116588.