Why Every Credit Card User Should Try an EMI Calculator

CIOTechOutlook Team | Friday, 14 February 2025, 09:34 IST

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Why Every Credit Card User Should Try an EMI CalculatorCredit cards have become a common way for many working professionals to make payments. This is because they can be a convenient means to shop without draining your current bank balance. However, you should use this card sensibly and only spend as much as you can pay up the next month. While this card has many benefits, one of its biggest benefits is a credit card loan. When taking out a credit card loan, you should be confident that you can seamlessly pay the monthly EMIs. To do this, it is recommended that all credit card users should try and use an EMI calculator.

What is an EMI Calculator?

It is a specialised calculator that helps you calculate monthly EMIs for any amount of principal. You can also input the required loan tenure in these calculators. Another feature is that you can adjust the rate of interest depending on what your bank is charging you. There are several such calculators available online which are free to use. You simply need to put in the amount of your credit card loan (known as the principal), the rate of interest charged by your bank, and the duration for which you have taken the loan (tenure).

Benefits of Using an EMI Calculator

Here are the benefits of using an EMI calculator for your credit card loan.

1. Easily Manage Credit Card Loans

With an EMI calculator, you can keep your loan in check. Before taking out this loan on your credit card, you can use the calculator to estimate the amount of monthly EMIs you will be paying. This gives you a fair idea of the monthly burden your loan carries. Doing this can help you better plan your other expenses each month. As a result, it will not leave you financially drained by the end of each month. 

2. Develop a Clear Payment Plan

In some cases, you may be shocked when you see your credit card statement at the end of the monthly billing cycle. If you have taken a loan on this card, then your EMIs will also be added to this bill every month. There may also be hidden charges on these loans levied monthly. Credit card users should use an EMI calculator to prevent such sudden financial burdens. This will help you plan ahead for each monthly payment (i.e. the EMIs and any hidden charges on a loan).

3. Reduce Stress Due to Financial Uncertainty

Taking on a credit card loan can seem quite stressful. This is usually the case if you have no idea of the actual amount you will have to pay each month towards the EMIs. With an EMI calculator, you no longer need to worry about this. This will also help you regain control over your finances and live stress-free, even with a loan.

4. Create a Predictable Monthly Budget

Once you have calculated the EMIs on your credit card loan, you should be able to develop a predictable monthly budget. By making this budget, you can inculcate financial discipline, which can lead to greater savings in the long term. With a pre-calculated EMI, you can also plan for investments using your disposable income to grow wealth exponentially. 

5. Avoid Additional Charges and High Interest Rates

Besides a loan, you may also have outstanding balances on your credit card. Banks usually charge very high interest rates on these outstanding balances. It is better to pay off these balances as soon as possible to prevent them from piling up. However, to plan these payments, you can use an EMI calculator to uncover the most cost-effective way to pay off these debts. Since you can input any tenure and interest rate in these calculators, they can also be used to plan your outstanding card balances on a monthly basis. 

6. Make Larger Purchases with More Confidence

With an EMI calculator at your disposal, you can now feel more confident about making larger purchases with your credit card. Most cards have the facility to convert larger purchases into monthly EMIs. You can also plan to pay off these EMIs using such a calculator. However, you must ensure that you only spend as much as you are financially capable of paying off the next month just to be on the safer side. 

Conclusion

With these 6 benefits of using an EMI calculator, it is clear that this is an effective financial planning tool for all. Especially for credit card holders, such a calculator can help them develop financial discipline and embark on a path to increasing their savings.

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