Credit cards are great! You can walk into a store and buy expensive clothes or gadgets, whip out your card, sign your name, and walk out without spending any money! What could be better? Then, thirty days later, the bill comes in the mail. As time goes on, the balance of that bill gets bigger and bigger - even though you are making the minimum monthly payments. Before you know it, you owe thousands of dollars, your minimum monthly payment has risen to an unmanageable amount, and the credit card company is calling you daily about paying your bill. Your credit just became a nightmare.
Credit card companies work to make sure that you stay in debt. That's their business model. As long as you are in debt to them, they are making money - and the more debt you have, the more money they make. They are not on your side. Sure, they made it easy to buy that new living room furniture. You have that fancy exercise equipment, and they helped you get it. But now, they want you to pay for it, with interest.
In spite of this, everyone needs one major credit card for a few good reasons. First, having a credit card and making your payments on time helps you establish credit. This way, when you go to buy your first home or automobile, you won't have any problems getting financed.
The second reason you need a credit card is for emergencies. If your hot water heater bursts, not only will it need to be replaced immediately, you may also need to replace some carpeting. If you don't have the cash to take care of this emergency, a credit card will come in handy.
Of course, the final reason you need a credit card is because everyone has one...no, not really...but we do live in a credit oriented world. You need a major credit card to rent cars, buy airline tickets, and reserve hotel rooms. Using credit cards for these things is okay, as long as you have the money set aside to pay your bill in full each month. If you don't have that money available, don't borrow it! Keep that card in your wallet.
Learn to keep your credit cards under control. Use them to fill up your car with gasoline once a month, and then pay off the balance right away when the bill comes. This will keep your card active, help you establish credit, and at the same time, keep you out of debt!
Find a Good Financial Planner
There are professionals who help individuals like you plan their financial
futures. They are called Financial Planners, and you may need one! A
financial planner can help you set and reach all of your financial goals - for
your entire life.
When it comes to money, most of us are emotionally attached to it.
However, a financial planner is much more objective and can help to guide
us in the right direction. It's like having a guardian angel.
First, a financial planner will help you create a financial statement to see
where you currently stand. Then, they will help you set up a budget. Believe
it or not, most of us really do need someone objective to tell us how, where,
and when we should spend our money.
Those who use financial planners
often do better financially than those who do not use financial planners.
Before setting up a budget, the financial planner should discuss your goals
with you. Do you want to purchase a house? When? Do you plan to have
children? When? Do you want your children to attend college? What age do
you want to retire? All of these decisions have a financial impact on your
life, and they must be planned for in advance.
With your financial goals in mind, the financial planner will work with you
to set up a budget that you can live with. That budget will incorporate your
financial goals. The financial planner can also advise you on investing your
money to reach all of your financial goals, within the time limits that you
have set.