Credit Card Debt
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By :
Amanda Brown
Submitted
2009-12-06 12:38:50 |
Getting out of debt is a challenging task. If you have not figured out the real reason for being in debt, there is nothing you can't do to become debt free. First requirement of getting out of debt is being honest with you and face the truth. Everyone has unique financial circumstances and it is impossible to pinpoint a single reason that gets most people in debt trouble. However, there are some well-known reasons that are responsible for getting more people in trouble than others. This article explores these reasons to raise the level of awareness about credit card debt.
Before we start, let's talk about the main reason why most people want a credit card. What was the biggest factor that got you sold on a credit card? Easy question, but some people can't figure out a good reason why they have credit cards. For them, it was just part of growing up and building credit. For others, convenience is the number one reason. Also, with the recent online shopping boom, purchase protection has started to creep up as another top reason. Regardless of your own reason, most people would agree the convenience to pay is the main attraction to own credit card. Convenience is such a tricky word and once offered, most people would expect more of it and that's where credit card companies start to win. Remember those convenience checks that you receive in your mail from the credit card company? Regular letters reminding you to take advantage of your credit limit and cash advances? Asking you to pay only $15 instead of your regular payment? All these are marketing gimmick targeting people who love convenience. It seems consumers are getting what they are asking for so where is the trouble?
Well, trouble start when people fail to differentiate convenience from financial traps. Most people will not apply and accept a loan that has introductory rate of 5% for 3 months and then a variable rate as high as 29.99%. However, people do that on a regular basis with convenience checks mailed by credit card issuer. For most people is it such a convenience because they don't have to go to a bank, fill out an application and then wait to hear whether you're approved for a loan or not. Cash advance checks arrive in your mail and all you have to do is to deposit them in your bank account and you're set.
You'll be surprised to know that a credit card issuer can easily offer a credit limit that is far higher than the annual salary of the card member and then send them cash advance checks. How in the world this individual would pay off the balance? This is a good question but credit card companies are not responsible to find out the answer. It is you job as a financially responsible individual to know that answer. These predatory practices by credit card issuers are almost identical to what tobacco companies do to lure teens in to smoking and yet only tobacco companies are sued for million of dollars for causing health damages. Why credit card issuers are not held responsible for ruining financial lives? Remember, your financial health is as important as your physical health, if you're in financial trouble, it will not only impact you but your whole family and that impact will not be limited to financial losses. Your financial problems will ruin your physical, emotional and mental health doing far more damages than a smoking habit.
Now that we know the impact of credit card debt, lets move on to the reasons Why people can't get out of credit card debt?.
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Author Resource:-
Amanda Brown is a staff writer for Fiscalwealth.com. She has published numerous articles on personal finance topics such as retirement, debt management, investment planning and budget planning. You can reach her at amanda.brown@fiscalwealth.com
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Article From Fiscalwealth | Personal Finances, Investment and Wealth Management
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