Got a New Credit Card? Here are 5 Important Tips to Keep in Mind

A credit card can be a powerful financial tool when used wisely. If you select a card that matches your spending habits, you can reap substantial rewards.However, undisciplined use can lead to significant debt.

Here are some crucial tips to maximize the benefits of your new credit card.

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1. Utilize Introductory Offers and Sign-Up Bonuses

Many credit cards offer enticing welcome benefits such as bonus reward points, discounts, or complimentary memberships.

For example, the Flipkart Axis Bank Credit Card offers a 50% discount on the first Swiggy order and a ₹500 Flipkart voucher.

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The HDFC Regalia Gold Credit Card provides gift vouchers and complimentary Club Vistara (Silver) membership.

To make the most of these offers, plan your expenses strategically. However, avoid overspending just to qualify for these benefits.

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Note that some transactions, like those converted into EMIs or returned purchases, might not count towards meeting the spend threshold.

2. Understand the Rewards Program and Bonus Categories

Credit cards provide value-back in the form of reward points or cashback. These can be enhanced on specific categories or brands.

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Familiarize yourself with the categories that offer maximum rewards and use your card accordingly. For example, if your card offers extra rewards on online spends, channel all your online purchases through the card.

Be aware of exclusions and conditions. Certain spends, such as on fuel or utilities, might not earn rewards, and some cards require reaching a spend milestone for accelerated earnings.


3. Spend Only What You Can Repay on Time

One of the biggest mistakes new cardholders make is only paying the minimum amount due.

This leads to finance charges on the remaining balance and disqualifies new transactions from the interest-free period. With high finance charges, even a small balance can quickly grow into significant debt.


Failure to pay even the minimum due results in late payment charges and affects your credit score.

Consistently overspending and carrying a balance can damage your credit profile by portraying you as a credit-hungry borrower.

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4. Avoid Cash Withdrawals

Cash withdrawals using a credit card do not qualify for the interest-free period. Finance charges start accruing from day one, along with a cash withdrawal fee ranging between 2% and 5% of the amount. This can lead to a debt spiral, as new transactions will also lose their interest-free status.

5. Utilize Additional Perks

Beyond rewards and cashback, credit cards often offer extra perks like travel benefits, hotel discounts, or airline memberships.

For example, travel cards might offer significant savings with hotel chains, but you need to register for the hotel’s membership program to benefit.

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Airline co-branded cards often provide complimentary frequent flyer memberships, offering additional privileges.

Activate your card within 30 days (plus a 7-day grace period) to continue enjoying these benefits. Enable online, international, and contactless transactions through your bank’s online portal.

Start using your card with these tips in mind to maximize its value. By understanding the rewards program, spending wisely, and paying your bills on time, you can enjoy substantial savings with your credit card.


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