What are the key benefits of SBI Credit Cards?

SBI Credit Cards offer a wide range of benefits, including rewards, cashback, lounge access, discounts, and insurance coverage.

How can I apply for an SBI Credit Card?

You can apply for an SBI Credit Card online through the Paisabazaar platform, where you can compare card options and check for pre-approved offers.

What factors should I consider when choosing an SBI Credit Card?

Consider your spending habits, lifestyle, and financial goals to select a card that best suits your needs, such as travel, shopping, or rewards.

How can I manage my SBI Credit Card efficiently?

SBI Card offers a user-friendly mobile app and online banking services to help you manage your card, check statements, make payments, and access additional features.

What precautions should I take to avoid accumulating credit card debt?

Responsible credit card usage includes paying bills on time, managing credit limits wisely, and avoiding unnecessary spending to prevent debt accumulation.

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11 Common myths about Credit Score

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11 Common myths about Credit Score

Sep 8, 2023

8 Minutes

Understanding Credit Score It is essential to be aware and clear of the misconceptions that people may have about credit scores. A credit score is a 3-digit number that reflects your creditworthiness.

It helps lenders assessing your risk as a borrower. The higher the credit score, the better it is for the borrower to borrow money from lenders. Common Myths about Credit Score

These are some common myths that people generally have about credit scores:

1. Check Your Credit Score/Cibil Score Will Lower it

This is a false notion and a common misconception. On the contrary, checking your credit score can be beneficial for you as it allows you to track your progress and take action when needed to improve the credit score.

2. Carrying a Balance On Your Credit Card Will Boost The Credit Score

This is not the case. Carrying a balance on your credit card will actually lower the credit score. It is better to pay off the credit card bills on time each month to keep a low credit utilization rate.

3. Your Income Impacts The Credit Score

This is incorrect. Your income does not have any impact on your credit score. It is based on credit history, total debt, repayment history, number and types of credit accounts, length of credit history and so on.

4. A Good Credit Score Means You Are Rich

This is not a truth. A good credit score does not reflect your income level. Credit score is used to measure your creditworthiness and is not based on your income level.

5. Paying Off Debt Increases Your Credit Score

This is only partially true. Paying off edit card or any loan on time will increase your credit score. But, if you are paying installments for an existing debt like mortgage or loan, it will not increase your credit score.

6. Student Loans Do Not Affect Credit Score

This is wrong. All types of loans, for example car loan, home loan, student loan, mortgage, etc, will affect your credit score. Pay them off on time to maintain a good credit score.

7. Getting Married Will Merge Your Credit Score With Your Spouse

False. Your marital status has no impact on your credit score. The credit score of each partner will be taken into account when you apply for a joint loan.

8. Using Debit Cards Will Help Build A Good Credit Score

This is also a false idea. Debit cards do not affect your credit score or appear in the credit report as they do not offer credit.

9. Closing a Credit Card Will Improve Your Credit Score

Closing a credit card will actually lower your credit score as it affects your credit utilization rate and length of credit history. But, if keeping the credit card involves paying an annual fee, you can consider closing it.

10. Low Credit Score Means Loan Rejection

A low credit score can negatively affect your loan application, but it does not guarantee a loan rejection. There are other factors that lenders take into consideration before approving the loan.

11. A Credit Score Is The Only Deciding Factor in Your Personal Loan Approval

No. Several other factors like income level, job profile, etc. are also taken into account by lenders when you apply for a loan. Importance of Considering Factors Like Investment Objectives, Risk Tolerance, and Diversification is important to consider the factors associated with your investment objectives, risk tolerance, and diversification before investing your hard-earned money. Investment objectives decide the reason you are investing. Factors such as income requirements, short vs long-term investment goals, and asset allocation should be taken into account.

Additionally, assessing one’s risk tolerance helps you identify the risk that you are comfortable with and decide on the type of investments. Lastly, diversification of assets helps you avoid

Conclusion:

Understanding the realities of credit scores is essential for managing your financial health. It's not just about a number; it's about your financial credibility. By dispelling these myths, we hope you're better equipped to make informed decisions about your credit.

Remember, it's not just about the score; it's about how you manage your financial responsibilities. So, monitor your credit, make timely payments, and strive for financial stability. Your credit score is a reflection of your financial habits and responsibility.

It helps lenders assessing your risk as a borrower. The higher the credit score, the better it is for the borrower to borrow money from lenders. Common Myths about Credit Score

These are some common myths that people generally have about credit scores:

1. Check Your Credit Score/Cibil Score Will Lower it

2. Carrying a Balance On Your Credit Card Will Boost The Credit Score

3. Your Income Impacts The Credit Score

4. A Good Credit Score Means You Are Rich

This is not a truth. A good credit score does not reflect your income level. Credit score is used to measure your creditworthiness and is not based on your income level.

5. Paying Off Debt Increases Your Credit Score

6. Student Loans Do Not Affect Credit Score

This is wrong. All types of loans, for example car loan, home loan, student loan, mortgage, etc, will affect your credit score. Pay them off on time to maintain a good credit score.

7. Getting Married Will Merge Your Credit Score With Your Spouse

False. Your marital status has no impact on your credit score. The credit score of each partner will be taken into account when you apply for a joint loan.

8. Using Debit Cards Will Help Build A Good Credit Score

This is also a false idea. Debit cards do not affect your credit score or appear in the credit report as they do not offer credit.

9. Closing a Credit Card Will Improve Your Credit Score

10. Low Credit Score Means Loan Rejection

A low credit score can negatively affect your loan application, but it does not guarantee a loan rejection. There are other factors that lenders take into consideration before approving the loan.

11. A Credit Score Is The Only Deciding Factor in Your Personal Loan Approval

Additionally, assessing one’s risk tolerance helps you identify the risk that you are comfortable with and decide on the type of investments. Lastly, diversification of assets helps you avoid