Why Are People So Afraid Of Credit Cards?

by Mack Bartlett

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Many people believe that having a credit card is too big of a risk to take. They fear several aspects of the credit card that can cause huge debt problems. What many people do not realize is that they control how much debt they take upon themselves, and they control how well they can manage a credit card. Some may fear things that they cannot control though, like theft, how high the interest rates can climb, and other penalties for late payments. Well, there are a few pieces of advice that can be offered for these kind of fears.

Fear: My Credit card may be stolen

It is out of your control when someone steals and misuses your credit card. Still there is comfort in knowing you can cancel your credit card immediately after you realize it has been stolen. This way you can advise the credit card companies not to make any kind of transactions with that particular credit card.

Fear: I will spend too much on credit cards

This risk applies to everyone. No matter how rich you are, you can still spend beyond your means using credit cards. The best solution to this is completely dependant upon the card holder. It is totally up to you to determine and control your spending habits so that you do not get into debt that you cannot escape. This is where many people fall short. The key is to be well disciplined. You will be rewarded for it if you keep your spending consistent enough with your payment abilities so that you can pay your bills on time. The best way to stay out of debt is to keep the amount of money that you spend low enough that you can pay it off frequently, like at the end of the month. If you only pay the minimum amount each month and spend more than you pay, this will rack up your debt to the point where it can be unbearable, consequently leaving you paying bills for several years to come.

Fear: People I know have credit cards with way high interest rates

Sometimes the interest rates on your credit cards can increase due to contract agreement, or as a penalty. It is important to know everything about your credit card agreement when you sign for one. You need to know how much the interest is, if and when it expires, how much the rate will increase after the expiration date, and how high it will be if you pay late on your bills or if you do not pay in full. The best way to prevent a shock when and if your interest rate goes up is to know ahead of time exactly how it’s going to change and whether or not you can afford a possible increase. Knowing the terms on your credit cards will also help you as you shop for the one that is right for you.

Fear: Not all credit cards are accepted at stores anyway

You should get a credit card that will be accpeted in most places, like Visa or Mastercard. These kinds of credit cards are seldom turned down, and it gives you easier access to buying on credit.

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