How to Save More with Your Credit Card

It is true that there are some negative elements attached to a charge card, however that depends on how you use the card. In today’s world, every item has pros and cons attached to it.

Here, we will discuss how you can save by using a credit card in the UAE.

Balance Transfer

Did you know that you can increase your savings by opting for a credit card that charges a lower interest rate? If you own a credit card that has a high monthly interest rate, it would be better to transfer to a card that charges lower interest.

Apply for a credit card that has a zero annual percentage rate in the UAE.

You can increase your savings if you can save on the interest rates. Interest rates might seem low at first, but if you calculate that by 12 months, you will realize that interest rates take up a high amount of money.

Pay Bill on Time

Everybody loves rewards that come with their charge cards. However, did you know that there are certain terms and conditions attached to the rewards? If you want to take advantage of the rewards that come with these cards, you will have to abide by the conditions.

Always make sure to pay your bill in time. Delay in payments or failing to pay the bill will result in late fees or fines. These will only put a dent in your savings as these fees can be quite high.

Also, try to pay your bill in full. Avoid paying the minimum bill as this will only increase your debt as time goes by.

Cards with Sign-Up Bonus

There are plenty of cards in the UAE market that provides a sign-up bonus when you join. Apply for those cards, if possible.

As a reward for signing up, you can receive rewards like free hotel stays, cashback rewards, air miles, etc. These types of reward will definitely be of use in the future.

Cashback rewards

Cashback cards are one of the most sought-after plastic money in the UAE. If you are prudent with your cashback card, you can use the cashback earned to pay your bill. You can use it pay the annual fee or the bill that you have incurred on your charge card.

Most cashback cards in the UAE offer cashback up to 2.5% of the purchase. Utilize that to your advantage.

Research

Don’t jump for the first card that you see in the UAE. Always make sure to research about particular cards. Remember, research and compare.

Applying for the first card that catches your eye in the market might end up disabling you. Financial institutions will always try to attract more customers with eye-catching offers. But you should know that eye-catching offers won’t last long.

When applying for plastic cards, you should make a list of what you would use the card for mostly. Do you want a card that offers you cashback, air miles, or entertainment benefits? Make the decision based on your needs and spending habits.

Avoid Having More Than One Card

If you are the type of person who can’t control their basic instinct, you should avoid having more than one card. this will only end up affecting your reward earnings negatively.

Having more than one card will also make you spend more than what you can afford, hence increasing your debt.

Credit Cover

Getting a cover for your charge card is not a necessity. You will be paying extra for a service that you are not even sure of ever needing it.

Credit cover is charged automatically by the card providers. To deactivate it, you will have to get in touch with the bank to remove it.

Credit Score

Charge cards have a huge impact on your credit Score in the UAE. Your charge card habits can change the situation of your credit score drastically, be it positive or negative.

Credit scores, as we know, can have an impact on the applications of loans. The credit score will not only affect your loan approvals but also the interest rates.

Cash Advances- A Big ‘NO’

Many card users use their charge cards for cash withdrawals. This, however, is not a good idea. Avoid withdrawing cash with your charge cards.

Cash withdrawals have a high fee in the UAE. Not only that, you will be charged a fee for every cash withdrawal that you make. Cash advances are not worth it. Opt for a personal loan in case of an emergency.

Negotiate for a Lower Interest

When it comes to negotiation, it is all about leverage. If you have a good reputation, you can negotiate with the bank for a lower interest rate.

Some banks are willing to negotiate if you have been a model customer. After all, they will try their best to keep a model customer from leaving them.

You should make sure not to lose your temper and be calm during the entire process. Banks are more willing to listen to a calm customer rather than a customer having a fit.

Over to You

In short, every charge card in the UAE comes with its own set of pros and cons. It depends on the usage of a particular individual.

With proper usage, you can turn your credit card into an asset. With ignorance and negligence, you will be drowning yourself into debt.

Make sure to adapt to a proper habit of timely bill payments. Never miss out on payments and you will be sure to earn a reward for it.