Debt Solution Source

How credit card debt creeps up around the unwary. How to watch for it and ways to avoid it.

Though difficult to believe now, at one time many years ago credit cards were a luxury, owned and flashed around only by the rich and famous or businessmen on the magnanimous expense account. (Years later exactly the same flaunting by the same beautiful people was being made with mobile phones – strapped conspicuously to the belt remember?).

Be that because it may, nowadays both these accoutrements are no longer luxuries; in reality they have become necessities of daily living. And together with them – or no less than with credit cards – has come a rather nasty little problem, to whit ‘credit card debt’. If we usually are not too careful it tends to steal up on us unawares, to produce itself painfully obvious over a regular monthly basis.

What is it and whence does it come? To answer this we have to know what happens behind the scenes, behind the counter with the bank or card provider. Your credit card merely represents the account you’ve with the bank or supplier. If you use it to buy that latest laptop or pay with an expensive dinner or whatever you are actually borrowing that money in the bank and the bank will remind you of the payments, or borrowings, at the end from the month. The hens – as hens are wont to complete – have come home to roost.

And these payments, aka borrowings, are what contributes for your credit card debt. Very easy isn’t it. Not exactly rocket science although in the event you let things slide it might need rocket science to get the situation back about the right track. But obviously you will not let that happen will you? You could not but thousands do though. And therein lies the scourge of the ubiquitous credit card.

So, you pay the amount on your own monthly statement through the due date and also you pay no interest. However, when you have been a little careless with your spending through the month, you may not have the ability to pay the amount which means you will incur a late fee and hefty interest charges. Or you could be able to pay slightly of this debt. That’s better than nothing – the bank won’t charge a late fee, just the interest on what has not been paid off.

So far so great. Some left still to pay, with interest accruing, at the end with the next month. When, oh dear, a bad month, somewhat short again so you can only pay a part of the debt again. And also the next month – only a part of it again…

So your credit card debit, like Topsy, grows. And grows .Should you continue making partial payments (or no payments whatsoever) the interest charges are calculated afresh about the new credit card debt. Which means you end up paying interest about the last month’s interest too.

Check out my other guide: household bank credit card, providian credit card and disney credit card

Business, small or big are increasingly according to business credit cards for various financial activities linked to the business. The ease, manageability and savings they bring to any organization makes them indispensable. Getting the right business credit card for your small business isn’t a big task should you keep these three things at heart.

1. How will you use it?

Are you going for rewards connected with the business credit card, or want discounts offered on business supplies. Can you fly frequently, and wish to get deals on hotel stay and airmiles? Business credit card have a variety of options. When you have your priorities clear it’s going to greatly allow you to get the

right business credit card.

2. What are the interest rates along with other fees?

A 0% Intro APR Business credit card with low interest rates on balance transfers, purchases etc. could be a good credit card to start with. Take a look at the APR, Annual fees, cash withdrawal fees, late payment penalties, minimum monthly payment requirements, balance transfer fees and whether the credit could be revolved or not. Compare different credit cards which offer the features you need and settle for the one that costs the minimum. If you would like a business credit card which can be given to the whole organization or your employees make certain that the credit card has this feature and doesn’t charge you

much on taking additional cards. Taking these points into account will make sure that you pay the least amount for the credit card company.

3. What will be the restrictions and other fine prints?

The rewards might be very attractive but credit card companies apply restrictions such as blackout dates, limits on reward points that may be earned during annually, expiry of reward options after a specific period etc. These restrictions can kill the reward benefits. Stay clear from credit cards which apply restrictions. Also, written in fine prints are terms that if ignored could cost a whole lot in terms of money and mental peace. It’s particularly advised to see them carefully and understand their implications on credit card ownership. When you have any doubt have it cleared by all means.

Business credit cards are especially designed for business purposes and has to be used as such. Using a business credit card for personal expenses might hurt within the long run and violates the fundamental principle of separating the business and personal finance. In the event the right card is selected and used properly the business

credit card may be a vital asset for the small business success.

Check out my other guide: household bank credit card, providian credit card and disney credit card