The Most Authentic Guide on Personal Finance and Investments


(Funny) Words of Wisdom : "Someone stole all my credit cards, but I won't be reporting it. The thief spends less than my wife did." ~ Henny Youngman

Many Credit Card Bills Equals Many Problems

As credit card usage becomes common, it is not unusual to find people using more than one credit card. In fact, having 2-3 credit cards is quite normal nowadays.

Unfortunately, however, this simple piece of plastic has become a WMfD (Weapon of Mass Financial Destruction). 

Why?

1. Splurging
Given the phenomenal explosion in the availability of attractive products and services in the market today — combined with the craze and temptation to own the latest stuff — it is but natural to spend (and spend).

And, when all that one has to do is to swipe a card, no one really thinks as to how he or she will pay when the bills finally arrive. Buy Now Pay Later! That's the mantra of today's consumer.

Instead, if your buying was limited by the amount of cash in your pocket, you have to seriously think a few times before splurging.

2. Expensive
The interest charges on credit card debt are massive... in fact, gigantic. Charges of 30-50% p.a. are quite common.

And when you carry forward your balance, the high interest hits you... and too compounding. Further, if you don't clear your bills on time, you have to pay interest on interest too. And on top of that, there is service tax also. Add this all up and you could easily end-up paying double / triple the original cost.

Besides, there is a serious twist in credit card interest calculations you must know.

credit-card-problems
Warning! The joy and happiness from Credit Cards is momentary only.

3. No breathing space
In case of a home loan or a car loan you get many years to repay, and that too in convenient EMIs.

Whereas with credit card you get at most a few weeks before the bill lands up at your doorstep and you have to pay the entire amount at one go. Sure, the amount is not as big as a home loan or a car loan. But many times it is substantial enough that you can't pay it by the due date. 

Yes, you have the option to pay only a nominal amount known as the Minimum Amount Due. However, if you decide to do so, that would indeed be a catastrophic decision.

4. Many bills
If you have too many credit cards, you have too many bills to pay too. This could mean that sometimes you don't have sufficient money to clear all of them. Even if you can, keeping track of them... month after month.. will be a big headache.     

When you cut down on your credit cards, you automatically cut down on splurging too. This, in turn, means lower bill value and hence easily payable before the due date. Thus, you save on the exorbitant interest costs. Moreover, it is so much comforting — mentally and emotionally — if you have to pay just one bill.

By the way, did you know that Credit Cards cause Global Warming.

In a nutshell, don't keep too many credit card bills outstanding... merge them. And, you would be pleasantly surprised by how beautiful the life becomes.

Try it out. Today!

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