the right credit card mindset

Let’s face it, we can’t imagine a world without a credit card. It’s just so convenient and dependable when you need it. Unfortunately, those that enjoy the privileges it has too much, end up getting bit in the ass for either exceeding their limit, missing their deadline, or paying only the minimum.

Credit cards are not in themselves evil. And it’s not bad for the companies to try to gain profit from loaning us money. They’re actually helping us in our daily activities and really helps make life more comfortable.

The best way to avoid getting buried in debt is to have the right mindset in using our credit card. See it as a 25 day loan that you have to pay back. Condition yourself to really pay that loan in full and not just the minimum. Everytime you use it, ask yourself if you can pay back the loan in full before the monthly deadline comes.

And by the way, make sure you have emergency funds. They’re not credit cards. I’m talking about cash in a bank account. This way, when you can longer afford a credit card, you have a back up plan.

Is the happiness brought by credit card use really priceless?

I am fascinated by master card’s advertisements. It basically shows how much happiness costs. It’s the classic example of how these companies utilize human emotion to get more customers. I particularly like the Christmas version.

Is it really priceless or is it just another advertising scam to gain more profit?

A lot of negative experiences in credit card use has made many people skeptical about the real issue behind all of the charges, increasing interest rates, and questionable offers.

Studies have shown that as of 2004, the average middle class American family’s debt totals in at about $8,000.00. That means that if an average family has 4 members, each already has a 2 thousand dollar debt to the credit card providers.

I think credit card companies should stop encouraging people to spend more. But LOL that’s wishful thinking. Their primary goal is to earn from the people’s debts. See, they don’t gain anything from those who pay on time. They gain more from the charges they impose on those who can’t meet the deadline.

So can credit cards buy you happiness? For the moment, until you get your bill. LOL!

What’s my other loans got to do with it?!

I’m a father of two kids and I work as a teacher at a local elementary school teacher in New York. My wife and I each own at least a couple of credit cards. We’re not highly dependent on them and are able to pay off our debt before the deadline. We made sure that we wouldn’t be deep in debt with our credit card because we all know how much they can increase the interest rates the higher debt we incur.

But our credit cards are not the only loans we have. We also have our car and mortgage loans. Back in 2000, we met through tough times when my wife lost her job so I had to support the entire family by myself. We missed our car and mortgage loan payments for about a couple of months but never the ones for the credit card. It was tough times. But after about 6 months, we were back on track.

A month ago, I got my bill and my interest went up from 8.9% to 19.8%! I called them up and questioned the increase since I didn’t miss a payment. The guy on the other line told me that they found out that I failed to pay my car loan for sixty days last 2000. That was 60 days ago! How could they do that?

I got my answer in the documentary I watched online. Turns out, they can charge interest based on our performance in other loans. Bummer.

What is a credit card?

The many horror stories of how the credit card have encouraged irresponsible financial management among majority of its users can practically scare the shit out of me. I don’t own a credit card but have been thinking about applying for one. But what is a credit card?

I’ve read articles online about various advice on credit card spending and even getting rid of them altogether because of the exorbitant surcharge and additional payments

After reading several definitions online, I basically see that it’s just a card that allows you to buy something using a credit provided by your card provider and promising to pay it later. Is it like a loan? For a person who is used to paying in cash, I would say that it definitely is. The kind of experience a card holder gets from owning one really depends on one’s ability to pay the bills on time and make sure that the debt does not become too much to handle.

I think it’s a wonderful system that has been irresponsibly used for instant gratification. It can come in handy during emergencies or very important purchases. But I now understand why things can get out of hand with a credit card. You don’t have to pay for everything that’s in your bill. Upon your choice, a minimum amount can be paid. So that results to your debt building up continuously until it becomes too much to handle.