Debt is a Burden that Builds

Ask just about anyone who is dealing with significant debt what led to their situation and you’ll find a common thread. Usually, it’s not that they took on some big financial commitments all at once but rather that an accumulation of smaller debt built up over time.


You can see how easily it happens. Using credit cards recklessly is one of the key ways people get in over their heads with debt. It’s commonplace today to use credit cards frequently. In fact, it is a stepping- stone to establishing credit and a strong credit score. But smart consumers know that the best way to use credit cards is to pay the total due amount each month. Otherwise, you will find yourself in deep debt.


Where people get into trouble is when they don’t pay the full amount due and then incur interest charges that are frequently over 20%. That’s great profit for the credit card issuers and the reason why you’ll find credit card offers from so many sources. Airlines offer frequent flier miles when you make purchases on their cards. Retailers offer on-the-spot discounts on your purchase if you accept their credit cards. Who wouldn’t want to earn travel miles or save money simply by accepting their credit card offers? Before you realize it, you have a wallet full of credit cards and usually no method of keeping track of all your purchases. And that is the way a debt burden builds.


Anyone that plans an individual or family budget learns that there are payments that must be made each month. Your mortgage or rent must be paid, or you’ll be evicted. Car payments must get paid or you’ll lose your car. Student loans are not forgivable. But credit cards give you the option to pay just a portion or even a minimum amount each month while you get to enjoy the goods or services you purchased with them. It’s the illusion that you can keep putting off your debt that keeps it growing rapidly and expensively.


Don’t fall into the debt trap that keeps building. Keep your credit cards to a minimum and pay them off each month. And always keep your expenses in line with your income.


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