I talked about the debt and how it can be good as well. Now lets talk about some steps which we can take to avoid being into debt, bad debt.
Avoid Buy Now Pay Nothing Till ….
I am sure that all of us have seen these flyers and newspaper advertisements with bold big headings begging you to buy all those big ticketed items now and pay nothing for next 12 months or even 24 months. Well it does feel good to buy all that stuff without paying at that time but the only catch is that if you don’t pay on time, you will be sucked into debt for years. The interest rates on these offers are usually very high and start to accumulate from the day you made that purchase. General rule here should be that don’t buy if you don’t have money to buy. So, it might be good idea to save first and then buy that product.
Change Your Attitude:
Do you remember a time when you had the money to pay your credit card balance and you didn’t pay it on time just because of your laziness or habit? Your this little mistake will cost you extra cash to pay and you may be paying the interest for next two months for all the purchases or cash advances you make using your credit card. Just close your eyes and think for a moment. Is it really worth missing your payment for even a one day when you have money? I am sure your answer will be no. So don’t do it next time and pay your bills on time.
We need to change our attitude towards the debt. If we borrow money, we need to pay it on time or we should avoid borrowing money.
Credit Cards Are Not Bad if Money is Paid Back on Time!
Are credit cards bad or having credit card is like being cursed? The honest answer is NO, credit cards are not bad it is the way we use these cards. I understand that if you have the credit card in your pocket, then you may want to use it for any thing you like and feel urgency to buy. The rule here is curbing that habit of buying things when you don’t have money or you don’t need them. I would not buy anything using my credit card if I have no money to pay that back. If you believe that you can’t do that then you may think of getting rid of all the credit cards and use either debt card or cash only for all your purchases.
In conclusion, debt is not about borrowing money, but managing your money and paying it back on time. There is no problem in borrowing money when you need it as long as you pay it back within the time.
