Cash advances are just one route through an expensive and self-inflicted credit crunch that has sent consumer behavior reeling. The phenomenon of late payments has been on our list of the red flags. For example, in June last year, on an average of almost two credit card bills a week, credit card companies billed nearly $79,000.00 for their personnel. That is an alarming two hundred and fifty thousand dollars a month, and could result in serious medical expenses. Of these, $12,000,000.00 was billed to the IRS for the purpose of “deductibles”, an industry term that describes the interest that the government takes in applying its definition of “deductible” over a longer period of time. Of this sum, $9,000,000.00 went to the IRS and was used to calculate the “calculated income”, essentially taking a deduction of the money that was paid to the IRS for the purpose. Now you might be asking: What the hell is a “deductible” amount? What is “cash flow” for these bills, what are the minimum amounts allowed to go toward debt and how does the government determine whether or not it is “complete” to avoid paying an interest penalty? What is the “benefit-to-cost ratio” of a credit card payment, how will interest rates relate to various other payments and is there any other method of quantifying the cost of debt and the “benefit-to-cost ratio” to be quantified?
I would like to suggest that when used properly and with restraint, cash advances should lead us in a direction of savings, not doom. The first step in maximizing the value of your credit cards is to pay them the full amount of all of your outstanding credit card payments. Paying less than the balance on the bank account or the payment of the total balance on the credit card you are using is not the way to go.
The above suggestions can lead you on a fine, healthy, rewarding and financially secure financial future. It is now your responsibility to take immediate action and make it work for you.
Why Credit Card Advances Are Bad News
The following are good reasons why there is a risk that you will exceed your credit, how they include high interest rates, minimum payment amounts, etcetera.
1. The term “credit card debt” is misleading. You actually need to use the term “credit card debt consolidation”. Any debt consolidation fee is attached to all of your existing credit cards, typically as a lump sum and is charged to various credit card accounts ranging from first $ to $ 5000 each month. To consolidate your loan, make sure that the time it takes to prepay pertain to the consolidation. This is a rate that will accrue interest, not just interest you would have to pay if you were to lose all of your existing credit cards.
2. A secured credit card is still a credit card. To get a credit card, you will need to use a secured credit card. A secured credit card is just the same as a traditional credit card, each time with a different secured credit card number and greater facility. With a traditional secured credit card, you will only need to enter on with the secured account, which will mean that you will be required to deposit your paycheck into a bank account, which you can then use to pay all of the unsecured credit card accounts. This is simply a form of credit card debt management, and will not be useful to you if you get in debt eventually.
3. Getting that $ 5000 each month in interest on the debt is going to take much longer than getting the $ 30000 each month your credit card bills tell you they are.
The below tip will help you to better manage your overall finances.
4. Keep all the necessary clothes, housing, necessities and other pertinent and useful allowances as well as your credit card balances. Get all your personal and tax statements immediately, including the ones that show where you have used your cards since you were young. An ATM may also be convenient, as it is connected to your ATM machine. These statements are proof of your finances and should be kept on file.
5. Keep all of your bank statements, credit card statements, and statements from your new credit cards. Keep all of the information regarding your credit account on hand, especially those statements that were cancelled earlier, any old errors, or other credit card miscreantias that were registered.
6. Check your credit report regularly if you have any fraud on your records. If you do have serious problems, don’t be intimidated.