Steve Martin

It is a fact, that today consumer debt here in America is at an all time high. Many people nowadays rarely use cash to pay for anything, they just simply charge everything on their cards. It isn’t hard to see why. With all of these slick commercials you see everyday on TV. The ones with people in line using cash to make a purchase and the rest of the store gasps in disbelief, or any one of the Capital One ads with the good old slogan “What’s In Your Wallet”. Now this would not be much of a problem at all if for only one thing. The addiction people have to monthly minimum payments and the mind set that puts them there.

Here is an example of most people’s mind set when it comes to shopping and credit. They are at the store and notice the big 52' inch plasma screen. And what do you know it’s on sale, marked down from $4,000 all the way down to $3,000. Then they notice on he corner of the TV, buy today and pay later, only $100 a month. It is a lot easier to just make the $100 monthly payment then to save up for the TV and buy it. That TV will end up costing thousands more by the time it is done being paid off.

You see having that mind set makes it so much easier to accumulate debt. Your in trouble when you open up your monthly statement and no longer look at the balance, but instead what the minimum payment is. This is exactly how mountains of debt get build.

The people who constantly just only make their minimums are stuck on what’s called the “credit treadmill”. The difference between this treadmill and the one at the gym is your losing money and not weight. It gets worse too. Just like the gym treadmill, you can only run on the credit treadmill for so long before falling off. Once at the point where it is hard to maintain even the minimums is when you are in real financial danger. All it takes is an increase in your interest rate and you will fall off the treadmill. When the interest rate gets bumped up from a moderate rate like 10% up to 25% or higher the minimums will double if not triple. Thus making it become close to impossible to keep up with these bills.

Unfortunately the dire financial situation described above is right where the credit card companies want you. This is where they make most of their money. Over 80% of your payment at this point will be going right to interest, not to mention the fees from going default and over the limit that will accompany the higher interest rate.

All of this can be avoided by adopting a mind set free of having to charge on your credit cards. When you feel that impulsive behavior kicking in when you see something you want to buy, fight it. If you have the money then buy it, if you don’t have the money do not think of your card as money. By thinking of your card as money and charging on it for “wants” and not “needs” you will assuredly accumulate debt. Get out of the habit of always using your card. Do not use it at places like McDonalds and for other purchases that you can easily use cash or debit. If you learn to have control over excessive spending and impulse buying you will not end up staring over your shoulder at a mountain of credit card debt.

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