Credit Cards: A Privilege or a Curse?
Most people, especially the ones who are tight on budgets and do not have much cash to go around on, will go at any means to be able to find other sources of income. People think that having credit cards is a status symbol and is something that most people praise. In reality, the ability to be able to control and discipline oneís self is the proper way to handle debt and avoid falling into the hole where reputation and financial reliability are the most common results for people who are unable to pay their debt on time based on the given cut-off period of settling debts.
Ideally, the people who receive credit cards for the first time become enthusiastic that they donít know what to do first and where to use these credit cards. Given a credit limit of substantial proportions, people are confident of buying, purchasing and going out on spending sprees. However, come billing time, this becomes the point where most people will find that they had gone deeper into debts, rather than escape them altogether. True, credit cards can help ease the burden of financial capacity needs, for a temporary time, but what people forget is that they were just given an extension and actually borrowing money for the meantime that they do not have the immediate cash to buy things, go shopping or spend at restaurants or establishments.
The interest rates that come from being unable to pay the minimum due for the use of the card are what make the credit card companies earn their keep. The amount unsettled will usually spell the difference in earning, thus the compounded interest rates for unsettled billing amounts. It comes to a point however that not all people are able to settle the entire amount, and this accumulates until it reaches astronomical amounts, leaving some people no choice but to abandon their cards and wait for the necessary legal actions by credit card companies. While this will tarnish the name of the individual, there are ways to which people convene and resort to, that of which is to declare bankruptcy or just dilly dally to avoid settling the amount. There are others who settle the said amount, but just the same, it seems like an endless contract since people will just end up demoralized at forever paying their debt and seemingly has no end in sight. So for people who think credit card owners are people whom they should look up to, better think again and ask them upfront if such a privilege is indeed a benefit or a bane altogether.
About the Author: Brian Yalung, MBA, is the Marketing Director for Merlion International Sales, Inc. He also maintains a blog site on Business, Entrepreneurship and Marketing. His work can be seen at http://www.biziki.com - Biziki for Pleasure Of Course.