Having credit cards can be a very convenient thing but if you do not control your spending using this credit facility, then you might find yourself in more problems than you started. Credit cards are very useful when you have a sudden need to purchase something but because they are so easily available, you could be raking in mountains of debts in a relatively short time.
Credit card debts are similar to all other outstanding amount you have owing to the bank. If you consolidate all your loans, you will find that the amount can be quite high because you could be looking at credit card debts, personal loans, hire purchase loans and many others. You could actually learn to reduce these loans through a proper planning and executing of a payback schedule.
To avoid being in too much credit card debts, you will need to first access your current financial situation. This can be done by looking at how much you are earning and how much you can spend per month. From there, you can work along a certain percentage for paying back of your credit cards. The most important factor is to look at what you can afford and try not to spend on those you can’t.
Plan your debt management
The objective is to reduce your credit card debts because among all other loans, this could be the one with the highest interest. Whether it is Standard Chartered Bank or Bank Islam, the interest rates are very much the same. So if you plan your debt management properly, you will not get caught.
If there is one problem people faced with debts is that they have a plan but they never see it through. If you only pay the minimum amount each month, it will take you up to 10 years to clear off everything provided that you do not make any additional expenditure.
Ultimately, what you want to achieve is to be have more income and lesser expenditure. If you are able to pay back all the outstanding amount each month, then it will be an added advantage. If you receive bonuses or year-end incentives in your working environment, try to clear out as much as you can while leaving some for expenditure.
The term cashless do not mean using cards. It means using cash but not in paper form. If you can cultivate the use of cash for all your expenditure and reduce the expenditure on your cards, then you will be on your way to becoming debt free from the credit cards.