Some of the financial institutions in particular the credit card companies will assault our youth with the various credit card offers at an early age and get them addicted to credit card usage. Most people don’t realize, especially not our youth that they are falling prey to a devasting system which slowly and efficiently reels them in and lulls them into a life of credit card usage. Before you know it your entire life has become dependent upon the use of credit cards. Most credit card companies know that when a young adult applies for a credit card they are more than likely going to remain loyal to that card company, sometimes for life.
So they target and market to young adults and earn their trust and that’s when it all begins. They assign you a credit limit of $200 or maybe $500 to start. You make a few purchases and make you minimum payment, (that’s what they want you do, pay the minimum payment). This allows the credit card company a chance to earn income through the interest they earn by you not paying off the balance in full.
After you have a good pay history for six months to a year they will increase your credit line sometimes to $1,000 or even $2,500. Now as a young adult you feel pretty important XYZ credit card company gave you a credit limit increase of $2,500. What this does is immediately get you thinking about what you can buy for $2,500 because you don’t have that kind of money in the bank. New stereo equipment; down payment for a car; new furniture; new clothes; vacation; party time, or whatever.
The bottom line is they slowly get you to start living on credit cards when you don’t have to. After a long period of time and sometimes a short period of time and it will happen without the proper education you become overextended, never again to see the light of day. Robbing Peter to pay Susan.
Ultimately you wind up doing the credit card shuffle. Transferring one credit card balance over to another because it has a lower rate. Once that rate expired normally in six months or one year you start all over again, and you inherit the fees that come along with the balance transfer.
Pretty soon you begin to think that the only way to live life or make purchases is with a credit card.
As mentioned previously they rope you in at the beginning phase and slowly hypnotizes our youth at a slow rate. It all seems so harmless. Pay your minimum payment of $15. You immediately think, $15, is that all? I can afford to pay that.
So don’t get roped into the snare. Use credit cards only in emergencies and pay off your balances in full. If you cannot pay off in full always pay more than the minimum payment. Try to double or triple those payments. Avoid having five or six or seven credit cards. There really is no need for that many.
Be smart and be careful. Talk to financial advisers or planners. The money used to pay credit card debt can be used to earn you money in the form of savings and investments for retirement or other incoming generating avenues.
Once you are reeled into this spiders web it is nearly impossible to free yourself from this credit card quagmire