Credit Cards are one of the popular choices among individuals looking to make financial transactions without paying an annual fee. These cards offer various rewards and cashback incentives, making them a smart choice for making everyday payments.
However, if not managed efficiently, it can lead to dues and debts. This is where the Credit Card EMI calculator comes in handy. In this blog, we will explore how to effectively manage free Credit Cards using the EMI calculator.
What does a free Credit Card mean?
A free Credit Card is basically a Credit Card that comes with no annual fees. With this Credit Card, you can avail benefits on dining, shopping, travel and other activities. To be eligible for this card, you need to be between 18 and 70 years old.
Ways the Credit Card EMI calculator helps efficient management
A Credit Card EMI calculator is an online tool available on the bank’s website that allows you to plan your Credit Card repayments more effectively. The tool provides a detailed breakdown of monthly EMIs, including interest. Here are some ways in which using a Credit Card EMI calculator offers efficient management.
Provides clarity on financial commitments
By using the Credit Card EMI calculator, you get clarity about your upcoming financial commitments. The tool helps you instantly calculate the EMI amount based on the purchase amount, interest rate and repayment tenure. This will help you understand your financial obligations for a month.
Offers effective budgeting and planning
The tool will also help in effective financial budgeting and planning. By knowing the fixed EMI amount in advance, you can budget your money wisely and set aside the right amount for timely repayment of your free Credit Card.
Avoid over-borrowing and debt traps
Using the Credit Card EMI calculator also helps in avoiding debt traps and over-borrowing. The tool provides you with a clear idea of your purchase capacity, helping you avoid spending beyond your limit.
Improves credit score management
Missed or late Credit Card payments can negatively impact your credit score. With the help of a Credit Card EMI calculator, you will effectively plan your EMI payments. This will further lead to a good credit score.
Mistakes to avoid when using the Credit Card EMI calculator
To make the most of your Credit Card EMI calculator and plan your finances effectively, you should avoid these common mistakes:
Entering the wrong loan or purchase amount
While using the Credit Card EMI calculator, one common mistake most people make is entering the wrong loan or purchase amount. You must assess your borrowing needs based on your income and then enter the correct amount.
Overlooking loan tenure
A loan tenure is another crucial factor while using the EMI calculator. A shorter tenure will lower the interest rates but increase the monthly payment. While a long tenure will lower the monthly payment, you ultimately pay more due to higher interest rates.
Ignoring interest rates
Checking the interest rates offered by the banks or financial institutes is also crucial while calculating the estimated monthly EMI. A high interest rate will lead to a higher repayment amount. Select the interest rate that aligns with your financial objectives.
Key Takeaways
Whether you are using a lifetime free Credit Card with no annual fees or other types of Credit Cards, planning the repayment is crucial. Using the online Credit Card EMI calculator, you will get the breakdown of the principal amount and interest you need to pay monthly for the Credit Card expenses. This will help you avoid overspending, manage your budget efficiently and make timely payments.
