Your New Credit Card Mindset

Here are the best ways that you should look at your credit card purchases in order to help you become a more responsible shopper.

When we buy with our credit cards, we always make sure that we are getting the best deal possible. If you consider yourself a responsible shopper, then you also understand that by not paying off your purchase, you are adding to the price of the item that you are purchasing. That means that you can easily add a huge 50% to the price of the item by not paying it off and allowing interest and other fees to accrue month after month.

They are a lots things that we purchase on a wim and often enough we tell our selves we must have it but really, we often do not. Once you buy something with your credit card and take it home, the purchase is almost devoid of value because you still owe money on it and yet, it does not satisfy that urge you had to purchase it in the first place. If you view your card purchases in this manner, it will help you keep from making them. Things are temporary, but debt goes on for long periods of time. Just think about how long it will take to pay for the item that you want to purchase. Can you see yourself continuing to pay for it in twelve months? That is very possible with a credit card purchase.

Add to your debt load. You keep adding to the amount of money that you owe when you buy things with your credit cards. It is not uncommon to hear of people who owe tens of thousands of dollars on their credit cards. Those who do are in jeopardy of never being able to pay them off, apart from working out a settlement or repayment plan. So, why allow yourself to get there in the first place?

Pay higher fees. When you make purchases and do not pay them off, you incur fees that add to your balances. But you also pay more in other ways, too. When you go to apply for other loans such as vehicles or mortgages, you will pay higher interest rates because your credit score is not what it should be. Life becomes more expensive when you do not view your credit card purchases properly.

Suppose you pay most of your purchases with cash or a debit card. Doing so will help promote responsible money management practices and will help you keep your balances low on your credit cards. In this way, you will have a proper view of credit cards and their place in your life. They should not command the amount of attention that they do if you employ responsible practices with them.

Your view of credit cards should encompass an overall money management strategy that puts them in their proper place in your financial picture. Use them for the occasional purchase, and then pay them off every month. And, avoid poor credit card practices and uses like balance transfer cards because of the high fees you can incur. If you can do this, then you have a fighting chance of staying out of major debt with credit cards.

Well, here's hoping!

Using Balance Transfers On Credit Cards to Repay Debt

Credit card balance transfers can be used as a legitimate way to repay debt. One of the main advantages of choosing this method of credit is that some credit cards offer 0% rates on balance transfers.Zero percent rates ensures that after paying the initial arrangement fee no other charges are incurred as long as the debt is repaid or transferred elsewhere before the introductory period expires.

The second main advantage of this type of credit agreement is that you can vary the amount ryou are paying back each month to suit your needs. I'd always recommend repaying the maximum amount you can afford so the debt reduces as quickly as possible however if you need to pay less in certain months then the option open to you. You can of course choose to pay less if you need the money elsewhere for example paying higher interest debts.

The third main advantage of using a credit card balance transfer to repay debt is that you can prioritize your debts so higher interest debts can be repaid first. Most credit card companies offer a low introductory rate and even a 0% introductory rate so if you are not able to transfer your entire debt to the card you can concentrate on repaying the other more expensive debts first. This ensures your debt costs you less in the longer term.

There are a number of things to remember if you choose to repay debt using a credit card balance transfer. The most important rule is to remember to always make at least the minimum payment on time to the credit card company. If you fail to do so you will most likely incur additional charges and possibly lose your introductory rate making this type of debt very expensive. Additionally late payments may result in more difficulty obtaining credit in the future. If a late payment is unavoidable contact your credit card company as soon as possible and explain any reasons why.

A second rule of thumb is to remember is to pay the most expensive debts first. If you have additional forms of credit that are more expensive concentrate your payments on these to reduce your overall cost of borrowing. Once you have repaid the most expensive debt move onto the next most expensive and so on until your debt is repaid.

The third rule you should try to remember is to always repay as much as possible from your debt. Your introductory rate won't last forever and the faster you can repay the debt the sooner you can forget about it. Try to not add additional spending to your credit card as this will be charged at a higher rate of interest than the balance transfer and it will increase the amount you need to repay.

When you sign up for the card make a note of the length of the introductory period of the balance transfer. As you approach the expiry date start to look around for a new credit card to transfer any remaining balance to. Don't worry if you get turned down for the first one you apply for, there are lots of credit card companies out there offering introductory balance transfer rates. Once you have arranged a new card, hopefully at 0% interest on balance transfers, move your money from the old card to the new and destroy your old card. You'll only pay a small fee for transferring the debt and if the rate is low enough you'll pay no interest again.

Try to ensure that you live within your budget and do not use easy credit as a way of purchasing items. Any money spent on credit cards will eventually have to be repaid or you'll face painful bankruptcy procedures that may affect your credit rating for years. It's possible to clear all your debts using this method, depending on the size of your debts and the amounts you can repay each month. It may take a long time but you will eventually be debt free. I myself was in debt for several thousand pounds and used the above method to clear my debts and now live a debt free life.