Finance Articles

Debt from credit cards and other unsecured debts have turned into a enormous problem for the greater part of families in the U.S. Individuals have become to used to just using their plastic to get whatever it is they want, whenever they want it, without really having the income to pay for it. Below I will list the top reasons that Americans end up becoming so stuck with credit card debt.

1. Buying Impulsively and Bad Spending Habits!

Impulse buying represents a lack of self-control. People will simply stumble across an item in a shop and pay for it on their plastic, because they just can't wait to own whatever item it is they bought, with no regard as to whether they actually have the money for it then or not. Credit cards feed the fire of buying on impulse that is what the cards are there for to gratify our need for instant gratification. You know there is a proverb "patience is a virtue" if some debtors adopted that rule they would never accrue those massive debts.

Undisciplined spending routines run along the same line as buying on impulse. Some debtors just spoil themselves far to often in life. For example, someone might go to a full service restaurant, and instead of ordering a sandwich and fries, they buy the filet mignons, the pre meal appetizer or two, the happy hour special, and the dessert special. Par for the course they charge it on their plastic. Don't take me out of context every once in a while splurging isn't bad, but for some people it is a everyday way of life. And these weak spending routines can blow up to a skyscraper of debt very fast.

My Advice: Next time you are at a store, any kind of store, and you are intending to make a purchase with your credit card. Look down at the items you are going to purchase and think to one's self "Do I really need these things?". If you find yourself buying something that is more of a want then a need put it back, and commit to yourself when you have "real money" not a credit card, to return and buy that item for yourself without charging your card. The key here is to establish the difference between wants and needs, your groceries are a need, your soap is a need, the new album is a want, the brand new pair of sneakers are a want. A tune up for your vehicle is a need, a supercharger for your vehicle is a want.

2. Holding Too Many Credit Cards!

This is the next largest problem to debtors getting into major debt problems. People plainly just can't reject the credit card offers they receive in the mail. Debtors get solicited in the mail saying your already approved and your credit limit is five thousand. For some people this is too much to take on and they will accept every offer and promptly put them to use.

My advice: Just throw these offers away! You don't need them. Think of every one of these credit offers you receive in the mail as a little financial time bomb waiting to blow you out of the water. The only way to cut it off is by placing them right into the garbage. Learn to reject the new credit applications you don't need them, this cannot be stressed loudly enough.

3. Cash Advances!

This is a seriously large factor in people stacking up debt. It is just so easy to go to the ATM and use cash against your card. However this becomes addictive to debtors and becomes a huge reason why they accumulate such large debt amounts.

My Advice: Stay away from cash advances. This essentially is just about the same as just charging on your card, you are still going to be paying interest and pile up a skyscraper of debt.

Steve Bis is a credit card debt analyst with the US Consumer Advocate, which practices in credit card debt settlement.