When you’re dealing with credit cards, there are several different things that you need to know, it’s important that you understand all the advantages and disadvantages that you should be aware of when you’re handling your finances. Your finance are one of the most important areas of your life, and it’s important that you are getting the most out of it.
Most of us know of financial expects that’s been telling us to get out our scissors and cut off our credit card. While this might sound splendid, hold on. Let’s look at this before you take the next action.
We all know that credits has been a part of American lives. Even when there was no plastic credit card. I wss told of my mother about when stores uses offers that was called. “Buy now, pay latter” plans. That with that plan she could buy a new sofa. Sign a payment agreement and take the sofa home that day. That mean she put a little money down to hold the sofa, and every payday she pay a little toward the purchase of the new sofa.
You can see that even before debt was turn to a plastic card people were still leaving on debt.
Is credit cards good or bad.
Credit card like a coin, one person may come up and said a coin as two side(head and tail) which is some how true but it also have an edge. So let’s stay on the edge of the coin and justify it.
With a credit card, it’s easy to fall into the trap of spending more than you have. No matter what’s in the bank. One swipe will get you whatever you want. But those purchases have to be repaid with interest. Credit card like all your finance we rise or fall base on how you manage your money. Budgeting and self control are key to reaping the benefits of credit cards without the negative consequence.
Meaning that the problem is not with credit card but money mastery. When you have the self control and will power to stand, you won’t be hefty in this temptation.
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It isn’t used to purchased appreciating assets.
Credit card debt isn’t used to buy appreciating assets. It’s may be used for depreciating purchase- like home furnishings, clothing items or gadgets- or consumables, such as food and gasoline. There’s nothing wrong with the purchases of this items . but paying interest on them is unnecessary and can rise their true price significantly.
A good rule of thumb is to avoid going into debt purchasing things that won’t go up in value should you cut up your credit cards? No, just pay more on them than you can afford to pay in full each month. Before any interest accrued. Credit card are a great tool when used correctly, but credit card is cripplingly expensive so don’t carry from one month to the next.
Credit card may not be right for you now.
Credit cards aren’t inherently bad, but if you think you’ll be able to use then responsibly, they’re probably not right for you right now. What did I said? I said, if your credit card will use you. You better hold on. How will you know your credit card will use you? If you’re worried that you’ll overspend and you currently have credit card debt, your primary goal should be establishing good financial habits and paying down outstanding balance.
Only open new credit card If it will help you work toward these goals. Rather than add to your problems. Even if you’re miles, remember that the rewards you earn pale in comparison to the interest you’ll be charged if you don’t pay your balance in full.
Signs credit card isn’t right for you.
- You’re only making the minimum monthly payment: perhaps more importantly, making only the minimum payment may be a signal that you’re spending outside of your means. Don’t forget, a credit card is essentially a small loan, if you find that you’re not able to put a dent in credit card balance, or that the balance is slowly growing overtime, you may be spending more than you are earning, if this so, it may be time to cut your easy access to credit.
- You already have high debt level: credit card are a financial tool; one that can be used against you. It’s up to you to make an active decision about which of these will apply In your case. Only open up a credit card if you are certain that you are able to use one responsibly, and that it will not end up adding to an already-overwheming load of consumer debt.
- You’re missing payment: a missing payment fee is a stinging slap on the waist and may be another indication that you’re not ready for a credit card. Managing a credit card or multiple credit cards. Take diligence. If you’re not ready to take on the responsibility of credit card management, you should consider doing without one. There is no shame from taking a break from credit card. As you are working over all financial management.