Avoid These Personal Finance Mistakes During Lockdown

By Kishore Sabareeshan | May 15, 2020

A lot of norms around payments and other financial dues have been eased, thanks to the lockdown. However, using these relaxations to your advantage involves making informed decisions. Read on to find out what you shouldn’t do.

Avoid These Personal Finance Mistakes During Lockdown

What a tumultuous year this has been so far. The COVID-19 pandemic has affected every aspect of lives across the globe. With the world still dealing with the virus, countries have taken steps to safeguard the well-being of their citizens. Towards this end, financial relaxations such as easier access to Provident Funds and moratorium facility for credit repayments have been introduced. As an individual, it is in your hands to make the best use of these eased norms to your advantage. Here are a list of don’ts you may want to be aware of if you don’t want to let COVID-19 affect your finances adversely.

Additional Reading: Lifestyle Changes To Retain Post Lockdown If You’re Looking To Save Money

Don’t Avail Moratorium For Credit Card Dues

While the moratorium can be a good thing if you’re looking to defer loan EMI payments, it may not help in the long run if you’re planning to avail it to defer your Credit Card dues. Why? Because you’ll continue to accrue heavy financial charges because your debt will keep piling up; you’ll be merely postponing a Credit Card debt trap. Moratorium works better for other credit products where the interest rate is fair.

Additional Reading: 4 Hacks To Keep Your Electricity Bills Low

Don’t Withdraw Cash Via Your Credit Card

As far as you possibly can, avoid withdrawing money via your Credit Card. Try sticking to your Debit Card for ATM withdrawals, because each withdrawal via a Credit Card will attract high interest. Also, it will only add to your mounting Credit Card debt. While the withdrawal feature on Credit Cards can come handy if that’s the only option you have, it certainly doesn’t have to be your go-to card for withdrawing cash.

Additional Reading: BankBazaar At Your Service During COVID-19

Don’t Let Your Credit Card Rewards Expire

With commute and dining-out minimised these days, you run the risk of not capitalizing on your hard-earned Credit Card reward points. The thing with rewards is that it is valid for a limited amount of time, so be sure to check your Credit Card’s terms & conditions. In case your points are expiring soon, it’s better you use them as soon as possible – nothing’s more tragic than losing out on rewards! Lockdown 4.0 is going to be good for e-shopping, so gear up and maximise your savings by shopping with your Credit Card.

Don’t Forget To Check Your Credit Score

Lockdown or not, it always helps to stay updated about your Experian Credit Score. Why? Because monitoring your credit report every now and then can give you updated information about whether all your credit repayments are going on as planned. Plus, you can catch any errors on time and get it rectified. Besides, checking your Credit Score is easy and can be done from the safety of your home. Try it now!

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Category: Money Management

About Kishore Sabareeshan

Kishore likes watching documentaries and discovering indie musicians on Youtube. When he's not writing content for a living, he's usually snacking, playing with his cockerspaniel or looking for big cats in the wild.

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