Why Are You Opening Your Wallet to the Credit Card Companies

October 26th, 2020 by admin Leave a reply »

Repairing you credit is absolutely vital if you want to afford a comfortable lifestyle. Now comfort is going to mean different things to different people so I will assume that you are not comfortable with your current life style. This information is not meant to make you rich nor will I promise you that it will apply to everyone. I know from my experience and those of my friends, family, and clients that having a good credit score can mean the difference in you being able to afford the house you’ve always wanted and living in an apartment. To be honest many jobs today will not hire you if you do not have good credit so if you want to move to a better job or career you need to get your credit in order.

Credit just like money is a state of mind meaning that money and credit mean different things to different people. If you where brought up believing that money was important and that it should be respected, saved, and invested then you are more than like going to accumulate a lot of it. If on the other hand you were brought up believe that money was just to spend no matter how much of it you had you are more than likely going to be living out of your means or in the red.

The good thing about this is no matter how you where brought up you have a choice on how now and in the future you will treat your money and your credit. The basis of any good strategy is to think it out find out why are you in debt. I know you are probably saying “Duh” I could not pay my bills. I know the generic reasons why but you have to dive in deep in your mind and discover for yourself why you are really in debt?

Most of my clients when I first meet them say they are in debt because they had a major emergency and it made them late on their credit card payments or some other “Excuse”. If this is you don’t worry I have been there to and for 12 years I used the same excuses. I blamed the credit card company who gave me the credit card, I blamed the bank for giving me credit knowing I did not have a good job, I even blamed the rich because they had money and credit, and I was just trying to live like them.

If this is you do not worry because the cycle can be broken you just have to choose which way you want to live. You can choose to have good credit and have money or you can choose to spend everything you got on things you really do not need so others can admire what you have. Don’t worry about trying to impress the “Jones’s” by keeping up with them because the “Jones’s” are usually broke they may make a little more income than you but they are spending much more than they take in so in essence they are “dead broke”.

I am not advocating that you should not have nice things you should have all the nice things your heart desires the point I am making is that if you are buying things and paying interest on them without a purpose you are robbing yourself. I am not saying do not by anything on credit because that is the way you build credit. I am saying what you buy on credit matters. If you are buying your gas on credit because you got a low interest rate and use it frequently and don’t mind paying the small interest rate to build your credit then I say go for it. On the other hand if you are buying everything on your credit card and then at the end of the month paying the minimums you are really robbing yourself. Some people use their credit cards to purchase everything because they think it is cool to slide the card. I know it sound ridiculous but believe me it happens all the time.

There are only three reasons you should use your credit card.

• Emergencies
• Planned small purchases to build your credit pay off slow to build your credit on low interest credit cards.
• Large pre planned purchase that you will pay off fast.

If something else outside of the above comes up you need to have the will power to delay instant gratification until you can afford to pay for it in cash. If you do not you will just spend and spend until your credit is exhausted and your credit score takes a dive. Believe me I have been there. The credit card company is in the business of making money so extending your credit line is meant to entice you to spend more money; this is how they stay in business. If you spend your credit line you are back to square one and are in debt to the credit card company.

It can be a big cycle if you let it. You have to live within your means. The only way to do this is to plan out your purchases and set budget for leisure things like eating out, movies, and so on. If you know how much you have to spend after you have taken care of your initial bills you can budget so you are not swiping your credit card for things like movie tickets. Movies are already expensive enough without tacking on high interest rates over a long period of time if you do this that $10 movie ticket could balloon and you end up paying $100’s for it.

With all that said I hope you get the point that until you actually choose to have good credit you will not. The credit cards and the companies that offer them are businesses and they could care less about what emergency has come upon you. You have to make a conscious effort to minimize not only what you spend on but how you spend it.

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