Is credit card dangerous? Well this is a common question to people that are new to using credit card or for those who are already in huge debt due to credit card usage.
I would like to bring out few things regarding the credit card which I think will be of some help to the readers: Rule #1 - Never buy something on credit thinking you will be receiving a payment due from some one.
This may sound like irrelevant.
But think of the following scenario: You have leased an apartment and made a deposit for $300 which is refundable.
You are planning to move out to new apartment by end of this month.
So you go out and start purchasing some furniture for your new apartment.
You buy furniture worth $300 thinking that you will pay it off when you get back the deposit of $300 after a month's time (normal refund term is 30 days in many cases).
Say the previous apartment office comes to you saying that there has been issue in the apartment that you stayed and you are liable to pay $100 for that.
Now you end up paying $100 for the apartment and extra $100 for the furniture that you brought.
In the worst scenario if you run out of cash at that point in time then your $100 will be carried over the next month.
The new apartment if it requires still more spending then you will be in greater financial crunch to say the least.
So by now you might have realized that buying something on credit relying on future payment can put you in financial risk.
Rule # 2 - Live within your means - Now your immediate reaction is easier said than done.
Right? Well it is possible but requires a little practice.
For example every time you go shopping and say you spend $100 then make it a point that you will add $5 to this and keep away that $5 for savings.
This sounds silly but honestly this is a good exercise and you will soon see a lot of money that way in a span of 6 to 12 month's time.
Rule # 3 - Practice control - Now what does this mean? Well the thing is in a week you will spend at least spend one day without spending not even a Cent for anything.
Please don't use your credit card on these days and say you haven't spent anything.
Rule # 4 - This is the most important.
Never forget Rule # 1, 2 & 3..
...
I would like to bring out few things regarding the credit card which I think will be of some help to the readers: Rule #1 - Never buy something on credit thinking you will be receiving a payment due from some one.
This may sound like irrelevant.
But think of the following scenario: You have leased an apartment and made a deposit for $300 which is refundable.
You are planning to move out to new apartment by end of this month.
So you go out and start purchasing some furniture for your new apartment.
You buy furniture worth $300 thinking that you will pay it off when you get back the deposit of $300 after a month's time (normal refund term is 30 days in many cases).
Say the previous apartment office comes to you saying that there has been issue in the apartment that you stayed and you are liable to pay $100 for that.
Now you end up paying $100 for the apartment and extra $100 for the furniture that you brought.
In the worst scenario if you run out of cash at that point in time then your $100 will be carried over the next month.
The new apartment if it requires still more spending then you will be in greater financial crunch to say the least.
So by now you might have realized that buying something on credit relying on future payment can put you in financial risk.
Rule # 2 - Live within your means - Now your immediate reaction is easier said than done.
Right? Well it is possible but requires a little practice.
For example every time you go shopping and say you spend $100 then make it a point that you will add $5 to this and keep away that $5 for savings.
This sounds silly but honestly this is a good exercise and you will soon see a lot of money that way in a span of 6 to 12 month's time.
Rule # 3 - Practice control - Now what does this mean? Well the thing is in a week you will spend at least spend one day without spending not even a Cent for anything.
Please don't use your credit card on these days and say you haven't spent anything.
Rule # 4 - This is the most important.
Never forget Rule # 1, 2 & 3..
...
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