Do you find yourself in your mid 20’s and you are paying
debts than you had initially planned? Debts that are usually planned should not
cause you any distress. If you enter the contract of a loan, you are expected
to be able to set aside enough amounts to be able to pay off the loan. The more
common reason why some people find themselves deep in debt is because of
mortgage and credit cards. Since mortgages are usually planned, let us focus
more on credit card debts.
More and more banks are making it easier for individuals to
apply for a credit card and it is alarming that some (if not most) of their
clients are not even really qualified to have the power of purchase using a
credit card. This kind of debt is very dangerous to carry because if you leave
it unpaid for a very long time without settlement, you might end up having to
file bankruptcy. This is something that you need to watch out for. Credit cards
are not really all that bad if you know how to use it. It can be a great source
of emergency funds. You can even hook it up with your line of credit for your checking account. This should give you the convenience to use your debit card
without having to worry about getting declined. This however can be costly if
you are not careful.
The best thing to do is bring cash or your debit card when
you go shopping. If you use your credit
card right away, you may end up paying interest for every item that you get. If
you use your debit card, you would then have to spend the money that you do
have. This should always be a good idea when it comes to making sure that you
are not paying unnecessary interests. If you really want to use your debit
card, make sure that you check your balance beforehand to make sure that you
will be able to set a proper budget for your grocery or shopping. As much as
possible, avoid using your credit card because it is just going to be one item
after the other and before you know it, you have reached your limit. You also
have to resist the temptation of having to open a new credit card account just
because you got pre-approved for one account. This is just plain stupid because
I do not see any reason why one would have to open multiple card accounts. You
are just going to have to pay 2 annual fees and it is just more reason for you
to be tempted to purchase items that is way too expensive. This kind of
purchase would usually end in tons of regret. If you do have multiple cards now
and you want to be debt free soon, better close the others and just leave one.
The more you get in touch with your finances as early as now, the more change
you will be able to avoid filing for bankruptcy.
