Credit Card Debts : Causes and Preventation

What is credit card debt?

Anyone own credit card ?

How many credit card do you have?

What credit card means to you?

If you have credit card, then credit card debts will sound familiar to you and you hate the most.

Credit card debts is an example of unsecured consumer debt which acessed through credit cards. Debts results when a client of credit card company purchases an item or sevices through credit card. Then, consumer's debt accumulates and increases with its interest and penalties will be charged when they do not pay the company for the money he or she has spent and bank will report the late payment to credit rating agencies in the book of "blacklist" customer. In addition the late payment penalties itself also increase the amount of debt the consumer has. So how "bad" of using credit card are?

There are few causes of credit card debt:

1.Swipe without thinking and unaware of the risks.

This is the general consensus of consumer groups on the alarming number of cerdit card users below the age of 30 who were blaklisted and later declared brankrupt due to fail on paying their credit card debts.

2.Poor money management skills

Monthly spending plan is essential. Card debts keep on increase day by day because of users without any idea where their money spending on those unnecessarily each month and end up having to charge purchases on which they spent.

3.Saving too little or no.

Normally ,youngest generation are least saving their money in bank where they like to spent almost 70% to 80% of their salary to clothing, food and beverage , car and electronic product. They are lack of the importance saving concept and not border that savings cushion in place will not cause immediate financial strain and increase debt.

4. Buy whatever you want now. Able to pay it off later in "maybe" terms.

For those credit card holders their hands are itchy and every new product that put in on shelves they will like to have one. It seems like those new products (eg.shiny HDTVand luxuries bag) are keep on calling their name to buy them. In result they cannot stand for the seduce and buy it and enjoy the debt painfully for the rest of the entire month.

5. Spending is your comfort activity.

Nowadays lot of people having their rough day, week or month either in workplace or home. Then they will try to make their feeling more happy by buying things on that moment. Sometimes it will causes them overspending of their budget and their life become more bitter and regret feelings rise when they receive the bank statement.

How to avoid credit card debt?

1. Manage your finances

Determine your monthly income and needed expenses by starting with a strategy where establish out a budget and then follow that budget exactly which will help you keep on track before you pull out the credit card for futher spending.

2. Shop for the right card.

It is very important for everyone to really gather around and get a credit card personalized for tour particular situation where try to getting one with no or very low fees and low interest. So, take your time and effort to compare different offers, but with the high saturation of the market which perfect fit for your wallet.

3.Know our credit card interest rate

If we going to use credit card in future while cant 100% gurantee that we will pay the balance in full of each month. Then we are strictly recommend to know the interest rate that charge to us due to late payment. In addition, check the rate of our monthly staements because credit card issuers can raise uor rates for a little or no apparent reason.

4.Pay on time.

Never even ever to make a late payment to anyone including car and house payments because penalties will be charged to every single overdue payment inreult it will increase the money that you owe from credit card company.

5.Use it like cash , not only card.

We must aware that everytime swipe our credit card it looks and feels the same for every single transaction because we treat it as card not money. So, we cannot physically feel our charges climbing higher and higher. Thus,we need to imagine every time we pull out the card as thickness of cashbut with each purchase we feels it become lesser and lesser.

Credit card owner should always remember " Preventation is better than cure".