Do you have credit card debt? Will you feel stress when you live in a debt? AND … How can you live in stress free life and not bankruptcies? Here are the some causes that you faced in debt and some of the methods help you to prevent credit card debt.
CAUSES
1) Poor Money Management
If you have no plan for monthly spending and didn’t pay your bills monthly, you wouldn’t know where your money is going. Maybe you will spend RM800 every month, but you do not realize it.
2) Lower salary, higher expenses
If parents have such situation and lose his/her job, debt arises obviously.
3)Underemployment
Are you underemployed? If yes, this means that your salary is not enough to cover your expenses. So, you need to cut down on your lifestyle. Forget about shopping at Pavilion every weekend if you only work for RM 800 per month. However, if you have salary RM5000 per month, then you can think about the luxury brand- LOUIS VUITTON.
4) Credit cards as a “crutch”
Many people use credit cards as a “crutch”. They will buy the things they desired notwithstanding they cannot really afford it. Then the accumulate amount of principle and interest is terrible.
PREVENTION
- Control your limit to avoid from using credit card.
- Well planned financial management to guide you become an organized consumer.
- Always pay on time to enjoy lower interest rates because this is the crucial factor that manages your payment schedule.
- Credit card should be use only when emergency happens, unless you plan in paying the entire balance off immediately.
- Spend less to avoid credit card debts.
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4 comments on "Causes And Prevention Of Credit Card Debts"
thanks for the tips to prevent on credit card debts.
A useful guide i would say, as they are many cases happen nowadays among the community where people over spent on their credit card and end up declare bankruptcy to run away from the debt.
well is true that we should not spend the money for the wants but perhaps should spend only on necessary items.
besides that, i would suggest another way to prevent on credit card debts is to limit yourself with only 1 or 2 credit cards and not more..
the more credit card you have the more debt you will need to pay. As one credit card can at least let u spend RM5k per month. imagine if you have 4 credit card.. and u spend RM5k x 4 per month = RM20k.. it will creates a big burden for you.
so lastly, always budget yourself and use the credit card wisely. =)
best regards,
eddiez
one of the best practice or habits u can get into regarding credit cards is to have direct debit set up so that you have to pay back the full amount each month....this means while you are convenienve of using the card in emergencies or while abroad,,you have a strong incentive not to let ur lending gt out of hand....
i also agree with what eddiez said. the best way is to just have one credit card. if not the more u have the more will spend without control yourself and it will make your financial have problem also.
besides that, i think the government should ask the credit card company to restrict the condition for applying credit card as now too easy for the consumer to get the credit card and cause them unable to repay..
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