Stop before you swipe: When a credit card is a bad idea

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Using a credit card is fine when you can pay the bill in full and on time. It’s not fine when the swipe turns into interest, penalties, or messy cash advances. Keep these simple rules in mind and you’ll avoid most traps.

If you’re unsure about paying the entire statement, don’t use the card. Rolling over even a small balance triggers high interest and snowballs fast. Paying only the minimum due keeps the card active but makes the debt linger.

Cash from a credit card starts charging interest the same day and usually adds a cash-advance fee. There’s no grace period. If you need cash, use your debit card or UPI to withdraw from your bank balance instead.

TVs, phones, travel—great deals can nudge impulse swipes. If you don’t have the cash set aside or a clear plan to repay within a couple of cycles, wait. Converting to an EMI only helps if the interest or fee is genuinely low and you can stick to the schedule.

Using a credit card to pay a loan, rent, or another EMI often attracts extra fees, may be treated like a cash-type transaction, and pushes up your utilisation. That hurts your credit score and can trap you in more expensive debt.

Card-to-wallet or card-to-account transfers usually carry fees and interest if not repaid immediately. If a repayment is delayed, you’re stuck with the charges. Use bank transfer or UPI from savings instead.

Some discounts need a high minimum spend, add processing fees, cap rewards, or delay cashback. Do a quick check: if the savings are smaller than the fees—or make you buy more than planned—skip it.

Swipe only when you can pay in full, avoid cash advances, and don’t use your card to plug other debts. Let your card earn rewards on routine spends you’ve already budgeted for, and keep UPI or debit handy for the rest.