An Introduction To The Humble, But Really Powerful, Credit Card

Literally billions of dollars are being used up on expenses that are only created because of the existence of the credit card industry. The most desirable customers for the credit card companies are the ones who make a payment on time every month but don't pay off the whole balance.

According to Herald Tribune for 2008 the President of European Central Bank Jean Claude Trichet told that another interest rate increase is possible because of inflation concerns. At the same time Ben Bernanke, the U.S Federal Reserve chairman, mentioned that he is ready to cut U.S rates so that he prevents a recession. He mentioned that all this downturn in the housing and credit markets in the U.S pose high risks to economy, therefore the consumer spending will slow down in 2008. Trichet said that he prefers to keep price stability. The Bank of England ignoring politicians, kept its interest rate at 5.5% in order to make easier the slowing growth.

Do not ever forget that after just five years at 15%, you'd owe double what you borrowed.
We live in an 'I-want-it-now' consumer culture, and we're willing to pay more than we can afford to fund our lifestyles. Just have in mind that whenever you deal with credit cards, you're playing with fire.

Once you've got a credit card, you'll find that you can do more with it than just pay for things with the card. Whatever you do, though, don't spend a whole day applying for every credit card you can find, just to see if anyone will take you.
If you directly ask why you haven't been accepted, then they usually have to tell you.

An increasing number of credit card holders in the UK have become dependant on their plastic to fund their living expenses, according to recent research. Being able to buy anything you want - as opposed to what you can afford - is definitely something we have taken for granted thanks to zero per cent credit cards and cheap personal loans. "In the UK only an estimated 6.9 million household bills were being either unpaid or paid late over the last six month period" is mentioned by a separate study from MoneyExpert.com

You might think there's not that much difference between a card that charges 15% APR and one that charges 12% APR.

You just have to remember that any money you've 'saved' hasn't really been saved at all. There are so many people who just look at the interest rates they're being charged, and don't understand the terrible difference it can make if you only ever pay the minimum payment. Do not ever forget that after just five years at 15%, you'd owe double what you borrowed.

The average family carries a balance of between £5,000 and £8,000 on all their credit cards, depending on which figures you believe. Borrowing a lot before you start paying anything back will make you look like a very bad risk, and so will going all the way up to (or even over) your limit on a credit card.

Remember that the debt spirals out of control from just a few thousand dollars borrowed to pay for essentials. You can negotiate your debts, and pay back much less than you owe as long as they get their debt plus interest in the end, no-one is expecting you to pay the full amount when you just can't afford to.
A minimum payment is the absolute lowest amount you can pay back to the credit card company each month you should pay more, but you don't have to. When you have enough money to pay off your debt, there's absolutely no reason to keep it. Debt is for people who don't have the money, and need to borrow it. Debt costs money, and savings make money you want as much of your finances as possible to be savings, not debts. If your savings account and credit card are with the same bank, then you're effectively paying for the privilege of borrowing your own money from them. Why would you do that?

If you're in a really bad situation, and you just can't even make your minimum payments this month, don't worry. Whatever happened, though, there's one thing you need to do, and quickly get on the phone. Do your best to give up any expensive habits you might have.

Pay your bills on the day you get them, and you'll live a much less stressful life. Don't let stigmas put you off; this is about your health. Almost everyone who has debts is stressed about them.

You will rarely be able to negotiate over your debts without doing some damage to your credit report. Moving debt around between cards often affects your credit rating in an odd way.

Your grace period is the amount of time between when you spend money and when you start paying interest on it. Almost no cards have a grace period on cash advances or credit card cheques, however.

If you do take a debt consolidation loan, you need to read the small print as if your life depended on it (it does), and then be very, very careful. Like anything, though, consolidation loans have their advantages and their disadvantages, and it pays to take a careful look at what they offer before you commit yourself.
If you've got a really unmanageable amount of credit card debt, you might be considering a consolidation loan.

In some countries, you might not have a legal leg to stand on your card issuer can do what they like to you. When it comes to Credit Card Issuers, getting it in writing also means that you can hold them to what they say later on.
If the advice you get is to sign up for another loan from one company in particular, don't believe it the chances are that the person you're talking to is just a salesman in disguise. There are some credit card lenders out there who are trying to scam you.

If you used half your savings to pay off that debt, you'd be in such a better position that it's really amazing. You're just making some small sacrifices for a while, and your life will be so much better for it in the long run.

They'll be able to lend you the money at a much better rate than a credit card would, simply because they know why you're taking the loan and can set regular monthly payments for you to repay it. With more unscrupulous companies, you will often be charged an annual fee, an application fee, and any other fee they can think of, all of which are added to your debt.

They are co-operative, owned by their members and run by the community, and are a great place to borrow money.

Don't be fooled by any offers that give you a good rate for a limited time you're going to have this loan for quite a while.
If you look at what your payments would be and think 'oh, how cheap!', the chances are you'd be signing up to them for a long time to come. You will find it very difficult to pay off all your credit cards once you have them.

Any offer that says it's for a limited time only is one you should ignore, as there's no reason to do it other than as a sales tactic. Any bill you don't pay whether it's for another card or for your electricity gets put on your credit record.
Transferring your entire balance to another card will make them sit up, take notice, and start making you much better offers than you ever got before. Many banks charge relatively high interest rates for overdrafts, but rarely as high as a credit card and they will give much better rates for good customers.

Good luck.

Christos Margetis

Christos Margetis is available for interviews and public speaking. The tips in this article were extracted from Chris's award- winning website. ClickGoFind offers best information and reviews for UK Credit Card Debt Consolidation and financial resources information.
This article is copyright (c) 2008 by Chris Margetis, and may be reprinted in it's entirety as long as this byline and copyright statement is included.

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