Credit cards play a major role in our financial lives and are a blessing at times of emergencies. For instance, for a salaried employee the first two weeks of a month are glorious. Why? Because many often use their salary in the first two weeks to go on a shopping spree, eating out at fancy restaurants, buy groceries and of course, simply pay off monthly EMIs homes, cars or other personal loans.

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However, trouble comes when the third week approaches, and we begin to count the pennies left in our pockets. The joy of first two weeks fades fast and spending options become extremely limited. Situation becomes worse when an unexpected bill makes its way to the list of payments due and there is no money left to pay! This surprise expense might be a result of medical emergencies, unplanned home repair, weekend plan, festivals etc.

Hence, for those who have credit cards are left with no choice but to swipe them during the end of month or in times of emergency. Although, it's quite true credit card comes as an helping hand during time of distress, but it does not take much time for this to turn into a nightmare as one is trapped in debt-burden.

Gaurav Gupta, Co-founder and CEO, MyLoanCare.in said, "Following demonetization in 2016, plastic money usage in India has increased significantly. With e-wallets and pre-paid accounts becoming the new norm, the number of credit/debit card holders has also gone up in the last couple of years. In fact, traditional modes of payment are now being replaced with card-based payment options."

Gupta added, "Credit cards, in particular, are catching up with the new-age Indian customers due to the convenience and rewards they provide. However, if used carelessly, credit cards can cause you serious financial trouble." 

To help you avoid such situations, MyLoanCare have enlisted five smart ways to use your credit card efficiently and get the best value out of it, in short, this is how you can avoid loss and actually gain a lot.

1. Pick the credit card that suits your spending needs

Different credit cards come with different benefits and rewards. Therefore, you should choose a card that will provide you with maximum benefits. Make sure to first identify your spending pattern, and then choose a card accordingly. The right card should cater to all your financial needs. For instance, if you drive daily to and from work, you may want to go for a fuel credit card that offers cashback on fuel purchases.

Similarly, for those who travel a lot, it’s better to pick a travel credit card with benefits such as hotel vouchers, air miles and airport lounge access.

2. Don’t make impulsive purchases

Cut your coat according to your cloth – you should follow this adage religiously while using credit cards. The whole idea of buying now and paying later may tempt you to make some impulsive purchases, but it’s important to keep a check on your monthly spending. Also, refrain from buying something extravagant without giving much thought to it so that you don’t face any struggle while repaying.

Even if your card has a high credit limit, you should be responsible and keep your spends within the limit.

3. Pay your bills on time

Don’t want to fall into the debt trap? Well, pay your credit card bills on time. While many tend to avoid this advice, you should always clear your credit card bills without any delay. There is an option of making the minimum balance payment against your dues, but you might have to face dire consequences later. Apart from high-interest rates, late payment of credit card dues can lower your credit card score and force you to pay additional late fees.

To avoid these issues, make a mental note of paying your credit card bills before the deadline.

4. Make the most of your rewards

Most credit cards offer reward points to their regular users. And, you can save a considerable amount of money by utilizing your reward points. However, these reward points come with an expiry date.

Therefore, you must keep a tab on the accumulated rewards and use them before they go to waste. In case, you need some guidance regarding the same, you can call your credit card issuer for more insights.

5. Check your credit card bill and statement

Instead of throwing away or deleting your credit card bills, go through them thoroughly. Besides giving you an opportunity to spot any clerical mistakes from your card operator’s end, this practice will allow you to take notice of any transactional fraud.

In addition, make sure to check your credit card statement online if your credit card issuer allows that.