Credit card debt is the unpaid balance on all credit cards. There is a debt when consumer purchases a good and services by using credit card. If a consumer has been late on payment, the debt will increase because there is a charged of interest and penalties when consumer does not pay the money they spent.Nowadays, many people have poor money management skill. They do not set a monthly spending plan and do not check the monthly bills so that debt happens. They do not set a budget and always buying things not needed by using credit card. It makes the credit card debts increase. Younger generation is lack of knowledge of saving and managing personal finances because parent and teacher do not teach them about the important of it.
Besides that, people who has less income but their expenses increase is also a causes of credit card debts. Their monthly income cannot afford their expenses, and then they forced to use the credit card to pay the expenses. This leads to a rise in debt.
In addition, some of them do not know the interest rate of credit card and spending maximum credit limit. They do not read the fine print of credit card and keep on to buy things.
How to prevent credit card debts?
1. Credit card holder should manage finances by set up a budget and stick to it. They must set a detailed monthly plan and check their monthly bills by clearly know their monthly income and expenses. It can make sure that they spend within the monthly plan budget and spend on needed expenses.
2. Card holder also must read the fine print and know the interest rate of the cards. Before you made payment or signed for agreement, you must read the details of the agreement such as the interest rate of the card and the rewards provided to card holder.
3. Card holder must pay the bill on time. Credit card companies can increase your interest rate if you made late payment.
4. Another prevention method is educating youngest generation about how to manage finances when they have a credit card. Parent is responsible to explain and teach their children about how to getting out of credit card debt. It also important to provide topics of saving and managing personal finances to educate students so that they will not meet debt problems in the future.
5. Card holder should go and look for consumer credit counselor that helps us solve the credit card debt by lowered the interest payments.
For further information,you can refer to:
(i) http://www.mozdex.com/prevent-credit-card-debt/
(ii) http://www.everlife.com/reducing-debts.php
1. Credit card holder should manage finances by set up a budget and stick to it. They must set a detailed monthly plan and check their monthly bills by clearly know their monthly income and expenses. It can make sure that they spend within the monthly plan budget and spend on needed expenses.
2. Card holder also must read the fine print and know the interest rate of the cards. Before you made payment or signed for agreement, you must read the details of the agreement such as the interest rate of the card and the rewards provided to card holder.
3. Card holder must pay the bill on time. Credit card companies can increase your interest rate if you made late payment.
4. Another prevention method is educating youngest generation about how to manage finances when they have a credit card. Parent is responsible to explain and teach their children about how to getting out of credit card debt. It also important to provide topics of saving and managing personal finances to educate students so that they will not meet debt problems in the future.
5. Card holder should go and look for consumer credit counselor that helps us solve the credit card debt by lowered the interest payments.
For further information,you can refer to:
(i) http://www.mozdex.com/prevent-credit-card-debt/
(ii) http://www.everlife.com/reducing-debts.php
I hope the above information provided can help you all have an understand about causes of credit card debt and the prevention methods.
By Teng Teng
Subscribe to:
Post Comments (Atom)
0 comments:
Post a Comment