Plan Your Diwali Shopping Using Credit Card

Every festive season comes with attractive discounts and offers from credit card companies. This Diwali, rest assured as multiple such offers will bethrown at you from offline as well as online stores. Although a lot of people shop for things they need during the Diwali offer, they still end up purchasing items that they do not need.

When shopping for things with a credit card during this Diwali, you need to be mindful of certain things. Do not buy items that you do not need and here’s how you can avoid that.

1. Spend within your budget

The festive season offers and discounts are irresistible. But you need to avoid shopping for items that you do not require, whether they are available at a great deal or not. This even implies when making a credit card purchase. Note that the interest rates charged are high (over 35%) – which means, you will be escalating the offer price of the item if you fail to repay the credit amount within the interest-free period.

• Look out for the EMI option

Most stores offer products on sale as well as the facility to pay in EMIs through your credit cards. Now, you may think that it is a cost-efficient way of purchasing anything, but it is not! It is noteworthy that paying EMIs every month come with fees that escalate the overall price of the item.

This way, you are not only paying a higher price on the product, but in case you fall in the default category – adding the penalty charges – the final cost of the product increases even further.

• Make repayment your priority

Festive seasons call for necessary credit card purchases that have been long due. During this time, if you already happen to be in a debt-like situation, the best thing to do is make sure that you repay the credit card amount on time. Do not restore to the habit of making the minimum due payment each month. See whether you can pay more than the minimum due amount.Also, it is advisable not to use your credit card until the debt amount is repaid.

• Close all the high-interest debt

If you are in a lot of credit card debt and setting a manageable repayment plan is not possible, you can consider utilisingyour emergency funds. Delay in paying the credit card debt will only increase the interest rate charged on it, further pushing you in more debt.

• Use cash for purchases

If you are already in a debt-like situation, maybe making a credit card purchase this Diwali is not a great option. Instead, you can buy all the things you need with cash. A cash purchase is also a better option to avoid buying any unnecessary items.

This festive season, be a smart customer and make sure that you do not fall victim to debt traps with your impulsive Diwali shopping.