What’s the easiest way to stay out of Credit Card Debt?
By Quinn Berglin
Hundreds of thousands of Americans find themselves in a hole when it comes to their credit card debt, and they just can’t find their way out. How can you ensure you’re not in debt?
In short, don’t spend on stuff you don’t need, and can’t afford. According to Creditcards, they suggest that you use your credit card as a tool to avoid carrying paper cash, rather than using it as a debt tool. Essentially, they suggest that you think of your credit card as physical money. If you don’t have enough money in your hand, you shouldn’t, and can’t, pay for it.
But what if I’m already in debt?
That’s an issue. This is because credit companies charge compound interest on your payments, which means you’ll have to pay more and more as your debt keeps getting higher. Creditkarma makes it easy to understand. They say, “Compound interest is basically interest on the principal amount plus whatever interest has already accrued.”
However, there is hope. Once you are in debt, yes, it is hard to get out. But this is only for those who can’t control their impulsive or lavish spending. If you’re in debt, cut spending costs on stuff you don’t need. Don’t go out for dinner four times a week; cook at home. Don’t buy those new shoes that you really need; control yourself. Shut off the lights, or shorter your showers, or simply just don’t buy things you don’t need. Soon enough you’ll find yourself climbing out of debt.
Works Cited
“8 Things You Must Know about Credit Card Debt.” CreditCards.com,www.creditcards.com/credit-card-news/help/8-things-to-know-about-credit-card-debt-6000.php.
Rosenberg, Eric, et al. “What Is Compound Interest & How Is It Calculated?” Credit Karma, 12 Aug. 2019, www.creditkarma.com/advice/i/compound-interest/.
I really liked this article because like you said in your writing, there are so many people who are actually in debt. Although in the article you did not explain directly how to get out of debt, you explained how different banks charge you debt and informed the reader in order for them to be more knowledgeable. If someone was in debt and read this article they would better understand why they are in debt and what they can do in order to get out of it.
ReplyDeleteCredit card debt seems like an easy thing to avoid but it takes a lot of effort to not fall into a pit of debt. Your hints to keep out of debt were almost common sense, but it's much harder than people think to stay out of debt.
ReplyDeleteThis article was over all really good because it went through and gave statistics and it had tips about credit card debt but I believe that you should use more statistics, maybe about by age or by bank. You can also go through and state more things the help prevent credit debt. I would also mention more about credit card debt and state how much each banking costs that hurts the credit card debt and different things to avoid credit card debt.
ReplyDeleteThe fact that several americans are in credit card debt just shows how little they know or how impulsive their spedning is.I agree with what you were talking about on just saving mroe money and don't buy thing that you don't need in life. I also know that I don't know a lot about intrest within a credit card and wodner how mnay other americans don't either and just spend aimlessly because they can just keep swiping the card. I think another thing people should be aware of with credit cards is just knowing how to budget what you buy and be able to pay that at the end of the month to receive good credit. Without good credit many people will never be able to get a car or a house of their own. The fact that over 8,000 people have over $500,000 in credit card debt means that we need to start having more education on credit cards and how abusing them can put a huge hole in someone's wallet.
ReplyDeleteWhat are some statistics about credit card debt in the United States? I feel like including some more data in your article would have strengthened it and also help inform us better. If you include statistics, then we can get a sense of how bad and common credit card debt really is in the United States, especially as we are getting older.
ReplyDeleteYes, I agree the credit card debt right now is very prominent to our society. That being said it is something that we need some tools and education on. It is a lot easier said than done to not spend what you do not have. Other tips that people say is to get a credit card and only put small purchases on it at first. When the bank gives you a max, that does not mean you have to reach that amount. That is why they give you such a high max, they are wanting you to over spend to a certain extent. Like you had mentioned and other commenters have talked about was the struggle it is to get out of the hole once you are in it. You can get up plans and getting out of debt should be a priority. There should be more tools to not only prevent debt to how to handle debt once you are in it. As we go to college it is inventible that most of us are going to have at least some debt in some form in the next couple of years.
ReplyDeleteI think that it is a good way to think that your credit card is just like money and that if you don’t have enough to spend, don’t spend any. I never really thought of replacing a credit card for cash because with cash, you can really limit yourself. If you don’t have enough cash; upfront you won’t be able to pay. But on a card you can still pay, it’s just that you will have to pay the bill off later. It makes sense that the people who tend to spend more will end up with more bills and will dig themselves into a hole. That is why I think it is super important to not make compulsive decisions, such as buying a sandwich out and about when you could just make it at home for less money. It is hard in today's society because we are being advertised everywhere for everything and it is hard to save that extra couple of dollars.
ReplyDeleteI agree with what you have to say about if you don't have the physical money to pay for it, then don't. I always think about how so many adults are in credit card debt and I personally want to avoid that when I get older. The really only specific reason I would get a credit card is to build my credit, but I wouldn't be spending hundreds of dollars on things I don't need. And the part you mentioned about staying at home and eating, I think that is a smart decision that a lot of Americans need to recognize that their money is going to that. Eating at home is so much cheaper. The only thing is that I kind of want to know how many Americans are in credit card debt and what are some statistics with that.
ReplyDeletePeople should probably make a budget on what they are going to spend their money on too to stay out of debt. Don't overspend with your credit card if it isn't within your budget.
ReplyDeleteYou're explanation of avoiding credit card debt and getting out of it was simple, as it should be. All you have to do is not spend money you don't have. For impulsive buyers, they may be difficult but it really shouldn't. Maybe being given a doubt tool, as you called it, is the real problem. By having a credit card, it's easy to overspend as you may not realize how much money you are actually spending and and you become accustomed to a lavish lifestyle because of it. Do you believe we'd have less debt if credit cards didn't exist? Is it okay not to have a credit card? What kind of backlash would be caused if credit cards were no longer given?
ReplyDeleteI think it would be really interesting if you took an argumentative stand and analyzed the importance (or lack of) of the credit card and how it affects debt as a whole. But I appreciate your straight forwardness in this article, it was a good read.
Most people that have credit card debt are ones that need create a budget. It seems kind of easy to avoid debt but still in your article you can see that people that have a net worth of 500,000 still have some debt. Credit card debt is something that everyone tries to avoid but at some point they find themselves wanting or needing more things causing them to go into debt. I think it would be interesting to see statics on age ranges and what the average debt for each age range is. It would give a better sense of who is more vulnerable to have debt.
ReplyDeleteI appreciate that you made a topic that can become very confusing very fast simple, and easier to understand. I agree that you should only buy something if you have the money for it. Over all it was a well written artical but I wish you would have gone into the numbers more, it would have given you paper more "oomf"
ReplyDeleteI would agree because some people just can’t control themselves when they're making bad directions and buying things they want left and right however, it does make a statement because what if the people who need the money for like a 2 week paycheck just spend it in 1 week and can’t get the rest well there is an app for that now it’s on the app store it’s called Earnin and you can “Cash out when you clock out.” Which if you think about it is the new way to get your money before your next paycheck is up.
ReplyDeleteThe question of how to avoid credit card debt was answered with a simple answer of don't buy things that you don't need or can't afford. Yes, this is true, you shouldn't buy the things that you don't need because you don't have the money physically in your hand but in reality people say and don't do. Credit Card debt tends to be a problem with impulsive buyers who think that having a card is the same thing as having cash when in reality it gives you the opportunity to keep spending the money that you don't have. Could credit cards be a more harmful then good thing? With people who don't know how to limit themselves they tend to put a whole in their wallet and people who know how to budget tend to be okay but in the statistics above people without debt are above all but people who are in debt aren't far behind.
ReplyDeleteIt is easy to get into credit card debt as many people don’t think of their credit card as actual money. If you only used cash and didn’t have enough of it, you cannot purchase anything. However, with credit cards you can purchase items even if you don’t have enough money, which causes many people to build up debt. I like how you mention that a simple way to avoid this is to think of your card as physical money. You article could be helpful to those who are compulsive buyers, and are the ones most likely to get into credit card debt.
ReplyDeleteDo you think it would be better for consumers if credit cards weren’t allowed to draw negatively? Better for banks? I think it would be worse for banks because then they are no longer receiving interest payments from their unwise customers. But for those unwise customers, it is yet another trade-off. If they aren’t allowed to draw negatively, they cannot find themselves in credit card debt at all. However, they can then find themselves in other forms of debt. Say that your car or house payments are in monthly installments, and that money comes from your credit line. If you make that payment with money you don’t have, you find yourself in credit card debt. If you cannot make that payment at all, because your credit line is unable to go negative, you are then risking repossession of that house or vehicle. Would you rather be in debt, or homeless? That, really, is the question.
ReplyDeleteThis article clearly illustrates the struggle American’s have staying out of credit card debt, which is concerning because money is spent on a daily. Nowadays paying with paper is becoming less common and therefore credit card debt is more common because like you said, paying with a credit card causes you to forget the value of the physical money that you are spending.
ReplyDeleteThis is a serious issue for many people that have credit cards and they over use it which results in debts. The question that comes into my mind right away is why do people choose to buy so much? You have to realize that so many people don't know how much they're actually spending and they don't stop. I like the fact that you talked about how people recommend to use it as if it's cash, but it doesn't work that way. This writing really makes you think twice with that your spending your money on. Great job.
ReplyDeleteOne of the biggest reasons that people get into credit card debt, is because they are not able to see their money actually go down. To check how much money you have in your bank account you have to either go into the banks website or use their app, and most of the time people purposely chose not to look so they don't feel bad. This is why i think that when people are about to by a want type idea they should use cash, so they can physically see their money go away.
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ReplyDeleteI really like that this blog post was fast and simple to read. It was able to show me that this is a big issue and for some people it is hard to avoid. I liked how you made your reference from Creditcards to think as your credit card as a tool to avoid actually carrying around paper money; and to think of your credit card as actual money. I feel like this is the number one issue to credit card debt as you mentioned. It can be pretty easy to over overspend with a credit card compared to having actual money in your pocket. Again like you said, if you dont have enough money in your hand you physically cant pay for it. Credit Cards are different, for people with a strong impulse to spend it may to hard to cut back.
ReplyDeleteThe issue of credit card debt is very interesting because if you don't get out of the hole immediately it just keeps compounding and making it tougher, and tougher to overcome. The problem for these people is procrastination, they leave the problem for later which is the biggest reason why the snowball effect begins. The question that I have about this issue is whether it's okay to not own a credit card? If you start spending physical money would that fix the problem? Every adult I know owns a credit card. If you get into debt what is the issue with ditching the credit card until you escape the debt? Another way to solve the problem would be developing better financial management skills. That way you can stay on top of your spending and make sure it doesn't get out of hand.
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