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Getting Into Financial Trouble With Plastic Card Credit

In a little over 40 years plastic credit has become the norm in some countries, notably the US and the UK. Credit cards are in the wallets of almost every adult over the age of 18, many with multiple cards. Plastic card credit is quick, easy, and convenient. With saturation marketing, consumers are virtually brainwashed from birth to live with card credit.

However, credit cards are expensive, with interest rates normally higher than other loans, except maybe in the early stages when some sort of incentive may apply. They are also so convenient, people tend to use them in a profligate manner, as if it really is plastic money and not real. Credit cards are also totally unnecessary when a debit card can be used as an alternative.

Credit card debt has soared and soared over the last few decades. Debt advice agencies for consumers are overwhelmed with people seeking help with their card debt, finally coming to realize that even plastic chickens do flutter home to roost.

The problem seems to be the detachment from reality that seems to accompany card credit, as opposed to mortgage or even car loans, which are perhaps easier to justify. It is when consumers start to reach for their credit card as a matter of routine, on a daily basis, without giving any thought to budgeting and what they can really afford, that credit card problems really start.

That not not be the case, though. It is actually easy to live without credit cards once you have made the decision to do so. Here are a few tips to help you make that decision successful:

1. Ask yourself if you would prefer to build up your own wealth or that of the financial institutions. If the answer is "your own" then cut up all your credit cards, and resolve to eliminate credit card debt forever.

2. If you cannot get a debit card, and need a credit card for convenience (as I do for online purchases), then keep one credit card and resolve to pay off the full amount when payment is due.

3. If you have too much credit card debt to cope with by being so ruthless, then consider just one, and only one ever, consolidation loan, and use that opportunity to get your finances into good order, debt free and with no need to borrow ever again except for a home mortgage loan.

4. Be proud of the fact that you have no more credit cards; throw a card cutting party even, just so all your friends know you mean business.

5. Get into a better budgeting routine each month, and be ruthless with those wasteful expenses. Think saving first, spending as an afterthought.

6. Take very good care of your health and diet. You do not want unnecessary medical fees messing up your wealth building plans.

 

Avoiding the use of card credit involves a decision, an attitude of mind, and personal resolve. As you watch your assets grow, while everyone else's shrink, you will wonder why you ever stupid enough to live on plastic credit.