Credit Cards – Are They Boon Or Bane?

In everyday life, many of us have to encounter, one time or other the problem of meeting some urgent financial commitment.  We may try to get a hand loan from one of our friends or relatives or colleagues. At times, if it is possible, we may even try to get a salary advance.  After meeting the commitment and when we next have cash in our hand, we return the money to the person concerned who lent in the first place. If it was a salary advance, the amount will straightaway be deducted from salary. Up to this, everything is fine and nothing to grumble.

With the constant changes in the modern life style, everybody indulges in shopping for both essential as well as non-essential things. Some of the things so bought would never be used; and some may be used once or twice. But we do not seem to stop this habit of shopping, just for the sake of ‘shopping!’ There is one main reason for indulging in such indiscreet acts. It is nothing but the accessibility of credit cards. Every person employed and with decent income can get a credit card with certain limit; in fact, depending on your income, you are likely to get even more than a handful of such credit cards. It is not a surprise if one has, in his possession, ten such credit cards – perhaps one for each finger!

When you have a number of credit cards what you do? Without taking into consideration the important facts, you go on using all the credit cards, alternatively, for buying things left and right or for settling bills for earlier purchases with installment loans.  Finally, one fine morning, you will realize that you do not have any cash in your hand, after settling the various credit card bills. And, if due to inadvertence, you allow things to continue the same way, you will not have enough cash even to settle your credit card bills. Is it a situation anyone would like to be in?  Certainly not! Then what you should do?

As a first step, close all the credit cards that carry higher rates of interest. As for the other credit cards, you start closing one by one at regular intervals and see to it that you do not possess more than one or two credit cards. You may ask ‘what I will do if I have to buy certain things for which I do not have ready cash?’ The answer is very simple. Try to put off such purchases till such time when you will have enough money in your account. If you cannot wait and you do not have cash, ask one of your friends to spare you this money which you can return as soon as possible. Never forget that ‘credit cards are as good or as bad as pay day loans!’

At least as far as pay day loans are concerned, you will have to return the loan amount when you next receive your pay. But, in the matter of credit cards, you are not bound to settle the whole bill; there are provisions for settling in installments. So, you take advantage of it and conveniently forget the accumulation of debts. Instead of availing of credit card facility, why don’t you consider using only debit cards? When you use the debit card, you use only from out of your savings in the account; and nothing more than that! This saves you a lot of embarrassment that may happen when you start using credit cards indiscreetly! Considering all things, credit cards are certainly not a boon; they are just bane!!

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