When you use your credit card for a long time and cross a benchmark limit set by the Bank, you get an opportunity to be a privileged member by getting your credit card upgraded. Yes, Banks will offer you a premium card with higher credit limit and rewards.

These premium benefits are handed over to you because of your payment history being clean and your credit behavior. When you plan to upgrade your card you definitely get a higher credit limit and better rewards. Although, there are 4 much important factors that you need to keep in mind while upgrading your credit card;

Increasing your Credit Score:

Credit score in today’s world is really important. It helps in getting you a good loan at a good rate of interest. While using your credit card, if you have a lower credit utilization ratio i.e. you use it lower than the limit given to you, this shows that you have less dependence on the credit card.

Deals, Offers and Rewards:

Since you are now a privileged member, the bank will not only upgrade your card but will also give you better deals, offers and rewards. These can be used for flights, hotels, vacations, luxuries etc. and hence it’s good for you. Most of the times, these offers will be tailor made for you as per your usage so that you can benefit a lot out of swiping the card. Please note that you need to read all terms and conditions.

Fees associated with credit card:

You must always be cautious about the annual fees to be paid for the upgraded credit card. For that, please research about the benefits that you will get with it. In case, these benefits are worth your time and you shall be using them often, please go ahead and use them. If not, then you can ask the Bank to waive off or reduce the annual charge. There is a possibility that they might reduce or waive it off as they do not want to lose you as a customer.

Hike in your expenses cycle:

Just because you now have a premium card and a higher credit limit, it doesn’t mean you need to spend more. You need to remember that it’s just you card that has got upgraded and not your income. Hence it’s best to limit your expenses. Also, the deals are shaped in such a way that to earn reward points you might end up spending more. Hence it is wise to be cautious around any hike you make in your expenses as when you spend more, you will end up repaying that same high amount back to the bank every month.

Here’s how you can apply for a new credit card by simply clicking here