There are many different issues that lead to debt for individuals or couples. Sometimes these issues are out of the individual’s control, including emergency medical situations, sudden drops in the economy, or the loss of work due to business closures or layoffs.
In the Victoria area, debt consultants at 4 Pillars work with individuals facing these types of issues. However, in most cases where debt is an issue, there is more than one reason for the problem. In most cases, the mishandling of credit cards and credit card debt has some part to play in consumer debt.
Some of the mistakes that 4 Pillars debt consultants see when credit card debt is an issue for an individual or a couple include:
- Overspending – the amount of credit offered by a credit card company is misleading. Many individuals use their credit cards for both small and large purchases, with the total quickly adding up. Interest and fees also add to the total until it becomes unmanageable.
- Cash advances – most credit cards offer cash advances. These cash advances are easy to get for those with good credit, but they come with a hefty interest if not paid off in the same billing cycle.
- Adding credit cards – qualifying for another credit card does not mean it is a wise choice to open the account. It is easier to manage one or two credit cards than several, avoiding missed payments or partial payments that can add to interest and fees.
- Partial or missed payments – credit card companies charge customers fees or penalties for missed or partial payments. Some companies increase interest rates with a missed or partial payment, which only escalates the level of debt.
Talking to a 4 Pillars debt consultant about credit card management is an effective way to avoid these issues moving forward.
