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Did You This About Credit Card Debt?

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Did you know you don’t have to carry a balance?
While it seems more people carry a balance each month on their credit cards then there are those that don’t, it is entirely possible to have credit cards without continuous balances. The smartest way to use any credit card is to not charge anything you do not have the cash to pay for at the end of the day. Any time you make a purchase, take the cash equivalent and put it in an envelope until the end of the month. Using this method, you will always be able to afford to pay off your balance each month. This will also ensure you are only charging what you can actually afford.

Did you know many people treat their credit as an extension of their income?
One of the main reasons so many people are in credit card debt these days is because the treat their credit cards as real cash without any real plan to be able to pay off the balance at the end of the month. When there is no money in the bank, there should be no spending on the credit cards. Desperate times do indeed call for desperate measures but by putting yourself only further in debt, you are better off making payment arrangements with your creditors during financial hardships rather than pay by credit. With interest and penalties, you can end up paying two or three times as much as you normally would have.

Did you know your credit card activity affects your credit score?
Where you use your card and what you buy can affect your credit score. While laws regarding this issue will change in 2010, creditors are now still using purchase data from your credit card records to determine if you are a bad risk. This has lead to many creditors cutting down lines of credit or credit card accounts are being closed all together. Your payment activity and history also affects your credit score calculation. Even if you never technically miss a payment, you can still drag down your credit score by paying late frequently.

Did you know you can renegotiate your debts on your own?
While there are tons of debt settlement and consolidation advertisements on television and the radio these days, there is really no reason you can negotiate your debts by yourself. Contact the creditor and ask them to work with you through your financial hardship. You may want to request a different payment amount to help you meet your obligations or you may ask them to lower or eliminate interest charges or penalties altogether to help lower your total balance. If you can be organized and motivated to follow up with your creditors, you should be able to do what professional debt agencies do everyday but for free.

Did you know the worst thing you can do if you find yourself unable to pay your credit card bills is nothing?
It’s never easy for anyone to deal with debt. Sure it’s embarrassing and frustrating but face it, the only way you will overcome debt is to deal with it head on. You will only be creating more harm for yourself and damaging your credit score even more if you simply do nothing about your debts. Start by contacting your creditor and explain honestly about your inability to make your monthly payment. Most will be more than willing to help you out, especially if you have been a loyal paying customer in the past. Things happen but there is no reason for you to close your eyes and wish it away. You need to do something about it to protect both your credit card account and your credit history and score, both of which you will need in your future.


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