Starting a Job? Know Are You Eligible for a Credit Card

Starting a Job? Know Are You Eligible for a Credit Card

There are many obvious perks of holding a credit card. These include reward points, cashback, air miles, discounts on spending etc. However, do you know that perhaps one of the major benefits of holding a credit card is it helps secure your future? No idea how? Read on about the product here before you click on the Axis Bank credit card apply button or on the apply option for any other credit card.

A credit card forms your credit reputation.

How well you are using the credit card will have a bearing upon your potential to be approved for specific loans in future like home loans, car loans etc. So, what are the things you require to keep in mind to make sure that your reputation linked with credit is spotless? Usually, if you are a starter, how long you have been using the credit card and how prompt you are in credit due repayment are a few of the parameters based upon which credit bureaus decide your credit score. Creditors depend upon your credit score to decide your credibility for a loan or credit card in the upcoming future. Thus, holding a good credit reputation does not just ameliorate your chances of loan approval; it even shows your personal financial habits.

Credit cards assists you earn various benefits in the form of rewards.

If saving is one of your major goals, then credit cards can assist you early on your financial journey. With credit cards, you can get a plethora of rewards like air miles, reward points, cashback and discounts when you use the card for a purchase. You can use the accumulated air miles and reward points to avail discounts on your big-ticket purchases or fund your flight tickets.

Credit card assists you make a big purchase.

Once you begin earning, it is just natural that you will want to fulfil your long term held aspirations – these include treating your parents to dinner at a good restaurant, planning a foreign trip, and buying costly gadgets that you wanted to own for quite long. Here is where a credit card rescues you.

Whenever you use your credit card to meet your big-ticket purchase, ensure to make your outstanding bill repayment by the due date. Few credit cards might also give you a choice to split these payments into extremely smaller ones. Read the clauses carefully before proceeding. The financial flexibility provided by credit cards is extremely unmatched. And it is probably one of the reasons why you must opt for it.

Ensure to use a credit card responsibly

While using a credit card disallows you to make transactions through your bank account, helping you maintain your liquidity, this instrument comes with various responsibilities. Missing the payment on your credit card can land you in a drastic debt trap that can take several years for you to be out. Rate of interest on credit cards can be as high as 20 – 52 percent p.a.  Availing of a lot of credit cards in a short time period may project you as a credit hungry individual, which may propel lenders or issuers to turn down your application for credit.

Should you apply for a credit card before you begin your first job?

Whether your first job is a few months away or you have one lined up to get started, you may wonder if you can apply for a credit card. Yes, there are a few options for securing a credit card before you begin your 9 to 5 job. Let’s examine how you can qualify for the credit card before you start working, what kind of credit card you may qualify for and how you can ameliorate your credit profile before you get your hands on your credit card before you get more established in your work life.

Here are ways you can avail credit cards, whether from Axis bank or any other bank. Note that you check your Axis Bank credit card status or the status of any other bank’s credit card; ensure to directly contact the bank.

Consider availing of a secured credit card.

Secured credit cards offer similar advantages as their regular counterpart. However, they are issued against your fixed deposit. With secured credit cards, you can protect lenders from the default risk and hence permit them to provide comparatively higher flexible eligibility criteria than standard credit cards. For instance, to avail Kotak Mahindra Aqua gold credit card, you must open an FD of a minimum of Rs 25,000 with the bank.

Add in other income sources.

In case you are unemployed, however, have a steady income source such as dividends from mutual funds etc., add this to your credit card application. Credit card issuers majorly review your repayment capacity, i.e., your potential to repay the outstanding credit card debt.

Become supplementary or add on the card user

If you neither have any fixed deposit investments nor income proofs, you may choose add-on credit cards in case someone in your family has a standard or primary credit card. With add on a credit card, which is an additional credit card issued under a primary card, you can make all your transactions with ease, just like in the case of a primary credit card. However, note that you must not spend more than the primary user’s repayment capacity as it will impact the primary user’s credit score negatively.

Show your employment letter if you are beginning a new job

Once you are selected, companies issue you an offer letter or a joining letter that mentions your monthly income. While this does not qualify as a form of the confirmation letter, it shows your earning potential. This might make you eligible for credit card approval.

Ending note

Even if you avail of a credit card without a job or before joining a new job, ensure it is used for the correct reasons. Do not buy items that you cannot pay and avoid availing of cash advance as you will have to bear not just the cash advance fee for the withdrawal but also huge finance charges until the final repayment is made.

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