Many a time, it is seen that people give importance to earning more money or on investing the money earned in various investment avenues. It is often misunderstood by many that earning and investing are alone sufficient to be wealthy. Equally important is to make the most of the money you already have. People generally tend to ignore this important aspect due to their busy schedules and demanding lifestyle. The following are a few tips which help you augment your money by making the most of it:
Make the most of your credit card: The increasing use of plastic money has led to the boom of the credit and debit card industry in our country. While debit cards keep an automatic check on your spending due to the instant debit from your account, credit cards are more dangerous. If not used properly, your credit card can upset your financial position greatly. When Raj used his credit card to purchase his mobile phone worth Rs. 25,000 he did not think it would become a big problem to his finances. When he received the bill the following month, the credit card outstanding was Rs. 25000, but the Minimum Amount Due was Rs. 200. Raj was elated that he had to pay only Rs. 200 at present, and thought he could pay the remaining amount at a later date. What Raj didn’t know was that he had to pay a huge interest on the difference amount at the rate of 3% per month. This amount is added to the next month’s bill, which again specifies a Minimum Amount Due. If Raj pays only the minimum due in the following month as well, the amount outstanding further balloons. This cycle continues and soon Raj will realise that the amount outstanding has increased to a very huge amount which is almost 3 or 4 times his original spend. It is therefore always better to pay the entire amount outstanding and not the minimum specified on the bill. A credit card is fine as long as you pay the full amount always on time.
Avoid paying penalties: