Credit cards are the best friend of many! Isn’t it? Well, they aren’t! If you actually observe carefully, they are the spots that are weakest to any saving aspiring investor. Yes, they are actually a sort of holes in your pocket, which drain out the money, very easily.
So, why should you actually avoid using credit cards?
It means you don’t follow a budgeting plan:
Budgeting is something most of us are aware of. This means that we are sparing across and spreading the earning on basic and needs of our life, every month. But, without budgeting, you will make your spending more than your earning, and that’s the reason why your credit card has been here. Change this habit for a month, stick to proper budgeting, though you needn’t count every cent, but take responsibility for larger chunks and see where your money is going unnecessarily and stop that. Sometimes even bad investments add to this, like investing in HBSwiss, which actually gulped in money, without throwing out any profit. By doing this, you can easily achieve your financial goals, and become a responsible financial planner.
Credit card adds more chaos:
If you hold a credit card, and sometimes have missed the payment, then you must be actually messing up your financial support. Missed credit payments lead to lower score which in turn affects your financial support that you gain from banks.
The interest rates on credit cards are also expensive. If you fail to pay them on time, the interest rates also add up making it more expensive in your monthly budget. It also gets compounded for every time you delay, every month and that not just puts a hole in your pocket, but also punches a seal as a bad loaner on your scorecard. So it’s always better to stick to your budget and avoid whole chain chaos that overall affects your score and financial support.
Bankruptcy might seem like an impossible path for many, but if you observe closely, it can happen to anyone who has been an impulsive spender. If you earn say 5000$ per month and have equal commitments accordingly, yet could save a mere 500 bucks, per month. With this, you aspire to own an apple laptop and you make the purchase with all your savings. Well, we are all humans, so here comes the medical bill, your family needs too, might be your child’s education is getting costlier and you have some pending bills too!! What would you do? Well, can you say that none of the above can occur to you? Well, life is always unpredictable. Bankruptcy can occur to anyone, who doesn’t have a proper financial planning, and this will badly affect his score, leading to further misery.