Debt Reduction Advice | Debt Reduction Advice

Credit Cards are the devil. I got my first credit card in college, and there were points where I found myself with nothing in my bank account and my credit card maxed out. I had a credit card because it was my emergency money, and I ended up using it on entertainment (restaurants, movies, games, liquor, everything!). Luckily, I pulled together enough funds within my 26 day grace limit and avoided the 19.5% interest. That is when I realized that credit cards should only be used for the real reason why they are there (or at least what they “market” them to college kids for), to build your credit so that when you need a mortgage or a large loan, you have a good credit history. Here are two reasons why you should always get rid of your credit card debt and pay on time:

Credit Card Companies Can Charge You Whatever They Want

With only 15 days notice, a credit card company can change it’s interest rate by 1/4%. This could mean a lot for a high-debt. They can also increase late payment fees and over-limit fees, without any justification to their actions. You can’t do anything about it! You could buy a TV for $1000, pay 10% interest, be late on a payment, then all of a sudden pay a $50 late payment fee and they can change the interest to 30% because you were late! See how crazy it can be? Your $2000 TV can become over $2650!

Credit Card Companies are a BUSINESS

It’s not like Santa Clause runs credit card companies. Credit card companies don’t just offer no-fee credit cards, 3-week interest-free loans, benefits and cash-back points because they are good hearted people. Credit card companies are a business, AND they are making record-profits because of US. They WANT us to rack up interest, debt and end up paying them more than we actually owe! To be honest with you, avoid using your credit card as a loan. Use it just to build credit, or at least try to pay off your debt within 3-6 months, that seems reasonable.

Credit cards are the devil! They are great when building credit and for short-term loans, but the high-interest can get you! Be smart with your plastic!