Does your monthly bill out exceed your income? Is it too big for your head? If so, you are not alone. A lot of people feel pressured to pay more than they have ‘even if they really don’t need it. Getting out of debt and paying off the bills you owe are easy, but it is not impossible. There are in fact an unproven number of people out there that do not know they are getting pressured into spending more than they really need.
First off, do not pay the entire balance of your credit card every month, or your minimum monthly payment (if you are already in this situation). Instead, work toward getting at least 50% of the money you can actually pay back in your credit card statement month after month. This can save you tens of thousands of dollars a year in interest!
Now, if you have a poor credit history, do not worry if this situation sounds overwhelming. Many Americans are struggling to make ends meet and face down financial stress. However, there are some very smart people who can help you out of the difficult situation. Make sure you have worked hard at establishing your credit. This isn’t your easy thing to do – we all make mistakes and it’s absolutely important to work toward making some progress. Pay your cards off and close accounts! Don’t allow yourself to become habituated to making higher interest payments until you are financially viable.
Start establishing a budget – this is really important to many people. The length of your credit budget (the amount you can afford each month) is critical. A good example is the amount you should buy for your car every month. Spending 20% or more of your income on car maintenance and repair isn’t going to help you pay down the debt you have accumulated. Instead simply pay the minimum amount you should owe. This will save you money over the long run and will help build a better, more financially viable future for yourself and your family.
A good way to build a budget is to transfer money from your savings or checking account to a card that you can jointly use with your partner. This way you are not turning your self into a collection pan. Instead, you are transferring your money from your fundscoring account to your card account. Now your partner is starting to provide other benefit income for the card account as well.
Common Mistakes With Credit Cards
Owning and using a credit card is a privilege. It is almost impossible for a person without credit or a credit card, to pay their monthly credit card bill. What a lot of people don’t realise is that not owning a credit card is, in reality, a privilege. A credit card is a very convenient way for you to control your spending and to get your essential utilities and services, within your power of habit, into your pocket. Not owning a credit card makes the credit card issuer responsible for anything you do with it.
According to the Federal Reserve’s (F.R.’s) Regulation S enacted in June, 2007, most ‘customers’ would qualify as ‘customers eligible’ for a credit card. The ‘eligible’ in the F.R. re is 31 years or older with no known medical issue. The intended effect of a credit card is to facilitate obtaining savings and loan from individuals and/or companies. However, many ‘customers’ have given up using a credit card because the card they have purchased in the past has ceased to function. Most ‘customers’ will avoid credit cards at the last minute. Therefore, all they need is a credit card and they will do-they will gladly do so. The F.R.’s regulations have also made credit card charging too expensive otherwise automatic. The additional charges on credit cards can be much higher than on the regular credit cards. There are many people who charge twice the normal rate of a regular card, until the card is used. Many people charge as much as 12% on their regular card before tax.
This can be a severe problem for the irresponsible and the over-efficient who keep accumulating credit card debt and then, at the end of the day, paying it off. To keep the interest rates low, the prudent man must charge a single single dollar on the regular card. At that rate, he can charge the bill to the credit card without paying any interest at all. But with a single dollar charge, the credit card holder is literally paying off the debt. But there has to be an upper limit to the interest charged. After a certain amount of time, some ‘experts’ have suggested setting the interest rate in the 19-23% range. This will raise the interest rate considerably to maintain a low interest rate.