Credit Card debts
The Credit card is issued by banks, retail stores, and other business merchants like savings and loans. It may be used to purchase goods and services or to borrow money. Unfortunately, a lot of people are ignorant of its proper usage and consequences from financial and non-financial perspectives when they get a new credit card. Here are some causes and prevention for the credit card debts.
Causes of credit card debts Click here: Top 10 causes of debt
Poor money management
A lot of people do not actually know where their money is going without a proper expenditure plan. For example, they are always spending on the items that do not have any corresponding value in monetary terms.
Unemployment
Nowadays, credit cards are commonly being used by householders for the purchase of utilities, groceries and some even for expenses to maintain their current lifestyle when had quit their job. The credit card debt keeps increasing day by day if the daily expenses are not cut down in line with the reduction in income.
Banking on a windfall and Financial illiteracy
A lot of people like spending tomorrow’s money today, which is very tempting. Apart from that, they also don’t understand why they must balance their checkbook, how to save and invest for a rainy day, and how money grows and works.
A lot of people like spending tomorrow’s money today, which is very tempting. Apart from that, they also don’t understand why they must balance their checkbook, how to save and invest for a rainy day, and how money grows and works.
Excessive Medical Expenses
Credit cards are very useful especially for emergencies such as to pay off the medical expenses. This occurs when the health insurance is not adequate to cover the medical bills whenever your family members suffers serious illnesses.
Credit cards are very useful especially for emergencies such as to pay off the medical expenses. This occurs when the health insurance is not adequate to cover the medical bills whenever your family members suffers serious illnesses.
Gambling
Gambling has become a part of popular lifestyle for some people. The addictive gambler succumbs to borrowing money for gambling through credit card that will surely lead to financial disaster.
Gambling has become a part of popular lifestyle for some people. The addictive gambler succumbs to borrowing money for gambling through credit card that will surely lead to financial disaster.
Prevention
Making an budget
Control and plan your expenditure by creating a clear budget that includes monthly utilities, groceries, entertainment and miscellaneous expenses. It will prevent overspending and reduce the debt load.
Control and plan your expenditure by creating a clear budget that includes monthly utilities, groceries, entertainment and miscellaneous expenses. It will prevent overspending and reduce the debt load.
Self control and discipline
Self control and discipline to keep these cards in the wallet and not to overspend. Thus, you will start to spend less in order to remain in a good financial situation. For example, people should not go gambling but instead should engage themselves in healthy hobbies. Click here: Credit Card Debt- Prevention Is Better Than Cure
Self control and discipline to keep these cards in the wallet and not to overspend. Thus, you will start to spend less in order to remain in a good financial situation. For example, people should not go gambling but instead should engage themselves in healthy hobbies. Click here: Credit Card Debt- Prevention Is Better Than Cure
Choose the best credit card
Pick the one with the lowest interest rates and cut up the other credit cards. Click here: Credit Card Debt Prevention
Pick the one with the lowest interest rates and cut up the other credit cards. Click here: Credit Card Debt Prevention
Pay on time
Never make a late payment on instalments especially for house and motor-vehicles' payments because, according to the universal default clause in the credit cards' conditions and terms, credit card companies can increase your interest rate if you make a late payment to any creditor.
Never make a late payment on instalments especially for house and motor-vehicles' payments because, according to the universal default clause in the credit cards' conditions and terms, credit card companies can increase your interest rate if you make a late payment to any creditor.
Move your debts
Transfer your debts from a credit card with higher annual interest rate to one with lower annual interest rate. This will allow you to buy more goods and pay a lesser amount of interest.
Transfer your debts from a credit card with higher annual interest rate to one with lower annual interest rate. This will allow you to buy more goods and pay a lesser amount of interest.
Reference(s):
Avoiding Credit Card Debt Preventive Medicine Is Best. (June 25, 2009).Retrieved Feb12, 2011 from http://www.cardratings.com › Credit Card News
Joannertollman. Credit Card Debt Prevention. Retrieved Feb12, 2011 from http://www.mozdex.com/prevent-credit-card-debt/
A.C. West. Understanding Credit Card Debt Problems. Retrieved Feb12, 2011 from http://ezinearticles.com/?Understanding-Credit-Card-Debt-Problems&id=1225936)
Steve Bucci. Top 10 causes of debt. Retrieved Feb12, 2011 from http://www.bankrate.com/brm/news/debt/debt_manage_2004/top-10-causes.asp
Joseph Kenny. Credit Card Debt- Prevention Is Better Than Cure. Retrieved Feb12, 2011 from http://ezinearticles.com/?Credit-Card-Debt---Prevention-Is-Better-Than-Cure&id=226244
the best method for prevention is teaching our youngest generation all about money before they even quality for a credit card.
ReplyDeletecredit card debt is on its all time high with today's economy. Hopefully people can obtain the help they need to get out of debt.
ReplyDeleteYes, this is a simple steps we can start taking today to avoid the trap of credit card debt because statistics show that student are entering college without ever having a personal finance class or knowing how to balance a checkbook.
ReplyDeleteYes, thanks for your comment..Apperciate it very much.
ReplyDelete