A credit card sure does bring a lot of advantages with it but on the other hand, it can become the worst nightmare for a few people. A credit card comes with a lot of responsibilities to handle. You need to use a credit card with caution and wisely to enjoy the endless benefits it has to offer. You can do so much with a credit card only when you know how to track credit card spending. If your expenses are more than your earnings then it can be a troublesome situation as you will not be able to clear the credit card dues. You can easily apply for the best credit cards in India online after comparing them. Here are the ways that you can consider to keep a track of your credit card spending.
- Make a budget: firstly you need to make your budget. Set out how you can afford cash payments after paying the credit card dues. You already know the status of your income. Make sure that you do not use more than 50% – 60% of your income so that you can save also.
- Make a list of your expenses: Next step is you need to make a list of your expenses that you are sure of that will definitely incur. Expenses like groceries, rent, electricity, DTH, etc. Just so you do not exceed your expenses more than your income. Having more expenses than your income can lead you to a possible trap.
Learn: How To Control Your Credit Card Expenses - Check credit card statement: After making purchases or using your credit card you can check the history of your expenses by regularly checking the credit card statement. This way you can also find out if there is any fraudulent activity on your account or not. So that you can report it immediately to the credit card issuer. Also, you can easily track your spendings while using a credit card overseas through the credit card statement. You do not have to maintain another expense book to keep a track of credit card usage.
- Check credit utilization ratio: To track your credit card spending you can check it through the credit utilization ratio. If you have a high credit utilization ratio then you have high credit card spending that can also affect your Credit score. It is advisable not to use a credit utilization ratio of more than 30% – 40%.
- Set up account alerts: You can set up your credit card account alert so that on reaching the threshold limit you avoid using the credit card. This will help you from overspending and will also help in building a good credit score.
- Use different credit cards for different purchases: To track credit card spending easily you can use different credit cards for different purchases. You will bifurcate credit cards according to the categories they provide the highest benefits. Like you can make travel expenses with travel credit cards, shopping expenses with lifestyle credit cards, and so on. This way you will remember your spendings.
Bottom Line:
To summarise, keeping a track of your credit card spendings can help you manage your expenses. You will be able to make informed decisions as to which expenses you can make and which ones are more unnecessary. You will inculcate the habit of saving. Apart from this, you will learn to budget your monthly expenses. On using a credit card you need to pay the bills also and there are high chances of missing a due date and to avoid this from happening you can register for the auto-debit services. Another way to track the spendings is to set the threshold limit on your credit card. On reaching this limit you can stop using your credit card or you can use a credit card only in the case of an emergency.
Share your tips on how one can track credit card spendings and how they can maximize the credit card benefits in the comment section.
Additional Reading – How To Pick The Best Credit Card For You – 6 Easy Steps
