How To Not Fall Into Credit Card Traps
You may have heard of banks and companies telling you that you are stupid if you do not have more than one credit card. Sounds familiar, right? Truth is, you are actually smarter financially than many people out there if you only have one. These financial companies have brainwashed many of us into believing that they are in fact doing us a favor and are going to help us save money somehow. They will give us cash-backs and lure us with too many offers. I tell you, do not fall for these credit card traps!
The trap they pose are often intentional. The credit card companies are making sure that you will end up using their card and or utilize a good chunk of the balance later on. That is exactly why they urge you to buy gas or groceries with it. Offering you 0% or even waiving interests as an introductory offer. Then, they will wait for you to make that one mistake, and then they will immediately shoot up the rates to 19% or even 30%! Nobody’s perfect. At one point in time, you may have forgotten a bill payment, or paid just one day late. It can be the electric bill or the water bill, did they doubled or tripled your payments as you were one day late? Credit card companies have no mercy, and they will do just that to rob you of your hard earned money. So, what now?
There are several reasons why credit card companies increased interest rates with no prior notice. Did you ever know that the higher balance you have on your credit card, the higher the risk you are to these financial institutions? They will raise interests at whim! If they see you as a high risk borrower, they can raise your interest rates. If you have too many debts over your head or when your debt to income ratio is too high, they will raise your interest rates. You may have heard of friends whose interest rates increased simply because they are making just the minimum payments each time. They will always find an excuse to ‘trap’ you, and you should not fall prey to these attacks.
It is a fact that many of us no matter how much money we make on a monthly basis, still have to live from one paycheck to another. There are those who live on payday loans to another. The more money we make, the better home or car we wanted to drive and own. But, this is how it is and only credit card companies are benefitting from all of these. Have you asked yourself how much you are putting away in savings for your retirement later on? Believe me, retirement is just around the corner and you will be shocked that you do not have much time to prepare for it! Before you knew it life passed you by, and you have tons of credit card debts to settle. Can you really afford taking the risk of falling prey to these traps?