Thursday, 21 April 2016

FINANCIAL Productivity: 7 Brilliant Do’s and Don’ts For Using Credit/Debit Cards-When You Want To Terminate Debt And Be Financially Wise

Financial productivity:  7 Brilliant Do’s and Don’ts For Using Credit/Debit Cards-When You Want To Terminate Debt And Be Financially Wise

Wall street journal report that, Americans’ debt grew in April as credit-card use surged, a sign of a rebound in consumer spending after a sluggish winter.
Outstanding consumer credit—reflecting Americans’ total debt outside of mortgages—rose by a seasonally adjusted $20.54 billion in April, or at a 7.33% annual rate, the Federal Reserve said Friday. Debt jumped 7.66% in March. Economists surveyed by The Wall Street Journal had expected consumer debt to rise $16 billion in April. The latest increase reflected a sharp rise in revolving credit, reflecting mostly credit-card debt, which increased at an 11.57% annual rate. That marked the second- biggest jump since the recession ended nearly six years ago.
Meanwhile, borrowing for cars and education grew at the slowest pace since July 2012. That category–so-called non-revolving credit—expanded at a 5.8% rate in April after growing 8.05% in March. Consumer spending accounts for more than two-thirds of economic output in the U.S. When consumers rein in spending, as they did in the first three months of the year, the economy typically slows.
Economists typically see a pickup in consumer debt as a sign Americans are gaining confidence and feel more secure.
But the growth could also be a sign money is tight for many households and they have few other options than to borrow. The latest pickup in debt comes amid steady job growth and early signs that Americans’ incomes are growing at a slightly faster pace after years of stagnant wages. Americans are also saving on gasoline, compared with a year ago, after a dive in oil prices from mid-2014.

Credit Cards Do's and Dont's

1- Stop all your credit card and keep only one for emergencies. Always use cash instead. And for the one you keep, be sure to choose one with the lowest interest rate and best credit facilities. If you search you find. If you are a student, look for student plans with zero monthly fees and very low interests and also a low renewal fee.

2- If you have multiple credit cards, transfer the debts to the card with the lowest interest rate or get a debt-consolidation loan from a bank at a very lower rate.

3- Use cash! And buy what you really need only!
4- Pay off the debts with the highest interest rate first.
5- Add an extra payment on the next debt by taking the payment you made on the first debt and adding it to the current debt.

6- Always have you notepad or PDA with you and invest in personal finance software to track your spending.
Search the web and you will find great software for competitive prices. Also invest in debt-reduction software, it will help you calculate and create a debt reduction plan.

7- Use consumer credit agencies to arrange repayment of debt. Many are free.

There is a lot of truth in the advice that credit cards are not a substitute for not having money. Every time you use a credit card this should be the theme replaying in your mind.
And you would do good to remember the following too.

Do s.
* Always plan for the purchases that you need and those that you want. You need the essentials, and you want everything else. The ability of making a distinction might help you plan wisely.
* If caught up in financial difficulties, it’s always good to talk to the issuer who might re-schedule your payments. If you simply default, that only helps to build up an unfavorable credit history and you might find yourself being denied credit next time.
* Unless it is an emergency, staying within your credit limits will help you a great deal. If you must spend over the limit, ensure you are within the manageable levels, say within 30 percent.
* And if your mails are flushed with more favorite deals than you currently are enjoying, you may approach your issuer for a better deal. They want to retain you as their customer, so they will listen.

Dont s
* Do not use your credit card to make house hold purchases. It’s expensive in the long run
* Do not just pay the minimal amount. You will end up paying exorbitant interest. The quicker you clear the debt the better.
* Do not use the credit card to purchase things you can’t afford.

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