How to be a smart credit card owner

For the longest time, it wasn’t an easy process to get a credit card. Various checks had to be done to make sure that you’re good for the debt.
Because let’s face it, that’s what a credit card allows you to do. Borrow money.
But things are looking up for those who wouldn’t be considered financially viable back in the day. Now, pretty much anyone could get a credit card. Even those who don’t know the first thing about managing a credit account.
If you think about it, we’ve come up with an amazing way to move money around. A credit card gives its user the buying power he or she would not normally have.
That’s all from a piece of plastic. This kind of freedom is dizzying for a lot of people and they have the tendency to overspend even though they know they’re going to have a hard time paying it off eventually.
It’s the illusion of that easy swipe that makes you feel like you’re not dipping into money that you don’t even have.
That’s why owning a credit card can be pretty dangerous if you don’t use it responsibly.

Never skip your credit card payments

I’m sure you’ve wondered, “Well, what if I just don’t pay off my credit card debt? What could they do about it?”
Let me tell you. Penalty fees. To cut it short, you’re never going to away with this. You’re going to have to pay it one way or another and with the addition of penalty fees.
The worst part about all this is that the compounded interest is added to your whole outstanding balance. So you’re going to have to pay way more than what you had initially borrowed.
Why do you think banks so willingly give anyone a credit card? Because the chances of something like this happening with someone who doesn’t know how to handle credit means profit for them.
If you avoid this for too long, they could file a lawsuit against you. It could get that bad. And a lawsuit will follow you around even if you flee the country.
Think death is the sweet escape? Nope. The debt will be incurred by the next responsible party. This could mean your spouse or your kid.
So never skip any payments a read the fine print.

Deil D Pecci is a writer and blogger based in Chicago who covers topics on personal finance and entrepreneurship. Deil D Pecci  has made Chicago her home along with his wife and children.

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