What You Need to Know about Your Credit Cards
The convenience offered by your credit cards is a double-edged sword. Your credit cards can allow you to make bigger purchases, take vacations with your family, and even make holidays more extravagant. However, in doing all of those things if you don’t have a solid plan, like a budget, to pay back your debts, you can end up facing serious financial hardship.
If credit card debt is causing trouble for your finances, Consolidated Credit can help get you back on track and provide resources to help you learn to use credit more successfully. Call today at 1-888-287-8506 to speak with a trained credit counsellor for a free debt and budget consultation. If you prefer to get started online, you can take your first step with a Free Debt Analysis.
Are credit cards a good financial tool or a bad one?
With all the reports on excessive household spending in Canada, it’s no wonder some people are turning away from the idea of using credit cards. True, credit cards have caused serious financial trouble for many Canadians in allowing them to live beyond their means. At the end of 2011, the average personal debt to income ratio in Canada was still at 153 per cent which means the average Canadian owes an additional $.53 for every dollar earned.
Still, are credit cards really the enemy of good finances? Credit cards can be a useful part of a healthy financial outlook, if they’re used responsibly. With the right budget strategy and a little thought to how and when you spend on credit, you can use credit cards without causing problems for your finances.
|Able to buy needed items now||Interest (higher cost for your items)|
|No need to carry cash||May pay additional fees|
|Creates a record of purchases||Financial difficulty can arise if you lose track of how much you spend|
|More convenient than writing cheques||Increased risk of impulse buying|
|Rewards programs||Purchase acceleration (may purchase more on credit to earn rewards)|
How credit cards cause financial hardship
The following habits have a high risk of getting you into trouble when you use credit:
- You use credit to make everyday purchases because you don’t have enough money in your budget to cover all your monthly expenses.
- You use credit without giving thought to when or how you’ll pay the debt back.
- You use credit to buy things you know are outside of your budget, because you really want it right then.
- You get in a cycle of using one credit card to pay the bill on another.
- You pay only the minimum amounts due on your credit card bills and never any more.
If any of these habits have gotten you into trouble with your finances, give us a call at 1-888-287-8506. A trained credit counsellor can assess your credit card debts with a free, confidential debt and budget analysis. To get started online, fill out our Free Debt Analysis form and a counsellor will contact you shortly.
What Our Clients Say About Consolidated Credit
…Making one payment every month allowed me to focus on proper budgeting and freed me from feeling overwhelmed with my numerous debt payments.
The counselors at Consolidated Credit answered my questions regarding my credit rating and although my credit rating wasn’t bettered by entering a consolidation program, overall my rating will be much higher with my high-interest debts paid off. I’m now on the road to repairing my rating and Consolidated Credit was a big help towards that goal…
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