Credit Card vs Personal Loan: What You Should Choose?

 


Debt has been diversified. It has been more personalized considering the differences in interest and factors. What suits you may not suit someone else. To meet your daily expenses or emergencies, you can take up debt from the market. It may be a personal loan or a credit card loan. Both of them are very different but have one thing in common, help you with fund instantly. If you are trying to choose one over the other, you must have a good understanding of the right one to go ahead. A personal loan is meant for high ticket expenses, while a credit card is meant for quick expenses. You must understand what they are and how they work. Choosing the right one will be easy once you know how both work for your needs.

 

What is a personal loan?

A personal loan is an amount of fund given to you as debt. It can be a small amount or a very high amount, depending upon your need and eligibility. You can use the money without any end-use limitations and pay it back in simple EMI monthly. If you are having a high expense coming up, a personal loan suits you.

 

What is a credit card?

A credit card is the most expensive form of debt. It comes with a credit limit that you can use to purchase anything you want. You cannot exceed your credit limit. There is a monthly bill cycle, where you have to pay your credit card bills within a month. It is a card and you can conveniently carry it anywhere when you don’t have enough cash and make a purchase.

 

Compare a credit card with a personal loan


Usage: A personal loan is applicable if you need to spend a big amount. For costly ticket purchase or an expense, you will need a personal loan. You cannot finance a wedding with a credit card. For quick and small purchases like a piece of jewelry, smartphone, or any gadget you can go for a credit card.

Interest rate: A personal loan comes with a low rate of interest as compared to credit cards. A credit card has a high rate of interest and makes bills payment high if you are spending without any limitations. A personal loan is the best possible debt that is affordable.

Tenure: A credit card comes with tenure of a lifetime and sometimes depends upon the type of card. A personal loan comes within tenure of one to six years.

 

Wrapping up

For a personal loan in Chandigarh, you need to apply online. A personal loan can suits you better if you consider usage and affordability.

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