When Do You Really Need Credit

When a holiday approaches, a lot of people spend their time on malls shopping for something they need and want for this special occasion. Most people usually burn lots of money during holidays just to get into the spirit of the event. And most of the time, we end up needing more cash to accomplish our goals. Many would resort to swiping their credit card(s) just to finish what they’ve started. While this may sound like a good idea, credit cards can actually ruin your days after these events if you don’t know how to use them properly. So, when do you really need credit to pay for what you need?

Credit cards are one of the most tempting financial tools that man has invented. This small plastic item holds enough purchasing power, that we can actually buy what we need without paying for cash right away. While this may seem amazing, getting into the debt trap cycle is actually quite easy with credit cards. In fact, more and more people are victims of a never-ending cycle of paying off their bills because of these credit tools. The same thing is true with loans. People readily apply for all types of loans that are available just to address their financial difficulties. They end up paying more loans than they’ve had before, because they depend too much on credits. Knowing when to get a credit and when to stop is vital to your financial situation in life. Don’t avail yourself of it just because it is available. It could bring you more troubles.

There are instances when credit card holders resort to debt management programs because they can’t control their use of credit cards. Although some people have an amazing self-discipline, many card holders lose their urge to buy on credit things that they don’t really need. It’s never too late to correct this mistake. While there are lots of tips on how you can change your spending behavior, there’s actually one way to make sure that you don’t resort to using a credit card based on whims and caprices. One way to avoid swiping your card is by knowing when you really need it.

Medical Emergencies

Resorting to credit is acceptable in a life and death situation. In case a family member requires emergency medical assistance, then using your credit would be a good solution. Instead of looking for people who can lend you money (which isn’t always sure by the way), why not use your credit to access the cash that you need? Although most credit companies command high interest rates and fees (if you have bad credit) when medical emergencies occur, people do not care about these. In most cases, you don’t have to get a big amount from your creditor. All you need is to have some money so that you can purchase whatever the doctor requires at that moment. Once the condition of the patient becomes stable, then you can look around for people who can lend you money for a lower interest rate and charges in lieu of your costly credit.

Unexpected Expenses

What are unexpected expenses? Basically, they could be anything that isn’t on your monthly budget. Accident is considered as an unexpected expense as everyone doesn’t expect an awful event to happen in the first place. Brace yourself that similar cases are possible to happen in your life. Being ready will help you to get financially afloat. However, there are some instances when two unexpected expenses come along your way. If the first one has already eaten up your savings, then the other problem should be addressed right away. But how can you solve the issue if you don’t have the finances to meet it? This is when you need financial assistance through credit that you can rely upon. More often than not, a credit card is your life saver when it comes to crucial situations like these.

Education

Although education is not a full guarantee to financial security in life, it will forever be considered as one of the most important investment. As far as anyone is concerned, everyone should get an education regardless whether this would land you a job or not. Using your credit on education may not seem like a good move for some people. Although this is true, most of us actually have a hard time coping up with our expenses. So in order to get our kids to school, we need to man up and take charge of doing anything that will allow us to give our children a good education.

Using credit like student loans to get our kids to school isn’t a bad idea. Although it’s also not a good one, you can’t blame parents and students in resorting to it. While there are alternatives, credits are by far the easiest and fastest way to get financial help. Keep in mind though that student loans are among the most vital credits in funding education. Without these, it would be impossible for all financially incapable students to obtain the degrees they dream of. So using credit when it comes to getting education is an acceptable situation. After all, there’s a good chance that you can pay it off once you finish your course rather than when not having a degree at all.

When Buying a House

Purchasing a house is different from buying a car. People can live without a vehicle yet it would be hard to live comfortably without a shelter. Buying a new house or an existing one requires a lot of cash. While there are only a few number of people who can spend big amounts of money to buy a house, most of us don’t have this type of luxury. We normally resort to getting credit like as a mortgage loan. It’s one of the best ways to have the house that we want although we don’t have cash to pay for it. While a home loan is quite a burden to pay regularly, the benefits it will bring to us is worth the hard work we put to meet our obligation. The use of credit on something important like a house isn’t a bad idea. Actually, it can be considered as an acceptable decision as owning a house is essential to living a comfortable, healthy, and secured lifestyle.

Credit cards and loans aren’t bad if you know when to use them. Smart people usually keep them in their arsenal. And when the time calls for that extra financial help, then they reach in and pull them out instantly. However, they also know how to limit the use of credit to keep them off the debt cycle.

As a card holder or a loan borrower, you need to know when to get credits and where to use them. Doing so will keep you from a lot of financial problems in days ahead. Keep in mind that credits would temporarily make you feel great if not used properly. In the long run though, you’ll wish that you shouldn’t have gotten one in the first place. Be sure to know when you really need it.

What Not to Put on a Credit Card?

According to finance experts, credit cards are considered as one of the most powerful credit tools in the planet. Any person who has one can use it on almost anything he needs in his daily activities. Although considered as great financial aids, they can also wreak havoc if not used properly. Credit card holders should always have a discipline. They should be careful while using their credit cards.

People nowadays usually have one or two credit cards either for personal or business purposes. A credit card can come in handy whether it’s for your kids’ clothes, your house repairs, a nice pair of shoes, or even for an emergency purposes. You can enjoy lots of good things about a credit card that will make almost every people happy. On the other hand, it can also be your worst nightmare if used in the wrong way.

So, how can you make sure that you don’t end up financially devastated with your credit cards? Knowing what not to put on your credit card will help you to avoid financial struggles in the future. Bear in mind that such cards have a high interest rate and fees that could pile up. Here are some of the stuff that you need to keep off from your credit card.

  • A Grand Wedding – every individual would love to give their partner a grand wedding. Of course, why not? A wedding is one of the most memorable and exciting life events to a couple. So, spending a big amount of money would be worth it, right? Actually, that depends on where you get the money. If you had the cash from your monthly salary or your earnings, then it’s not a big deal. However, if you got it from loans or from your credit card, it’s something that you need to worry about as soon as possible. Why? Basically, credit cards command a high interest rate that will definitely cause financial problems for the couple. Financial experts wouldn’t recommend that you get your wedding resources from a credit card. In fact, they would highly suggest that you source it from other alternatives. If you’re having a hard time with your finances, then why don’t you work within a budget. After all, it’s not how grand the wedding is that matters. It’s actually the fact that two people get united as one, which is more important.
  • Medical Bills – although medical bills are considered as one of the most important bills to give priority in a person’s life, the payment should not come from a credit card. Always bear in mind that medicines are among the stuff that usually has an irregular pricing. More often than not, their amount increase every now and then. And if you’re taking medicines, then most likely you’ve experienced the never ending increase in prices of medicines in the market. Add the high interest rates of credit cards to that and you’ll have the ingredients of a financial disaster. How can you pay something that often goes up in terms of amount? It’s quite difficult for people to pay their medical bills if they purchase them with the use of their credit card(s).
  • Education – we all know that education is important. Anyone would gladly use a credit card just to send their child to a good school, isn’t it? However, isn’t it smart if we find other sources of funds to get our kids to school? Credit cards aren’t actually the best option when it comes to financing your child’s education. You can find lots of good alternatives where you can get the money that you need to send your children to school. Among these is by asking a friend or relative to help you out with the tuition fee. Instead of paying a high interest, you can pay the lowest rate if you got the money from an acquaintance. In fact, some friends or relatives wouldn’t even bother getting extra cash in return for the money they lend to you. If you can’t get the money from them, then you can get it from another source. Student loans can also be acquired if you can’t find better options. A student loan is much better as compared to using a credit card. Although there are lots of perks if you know how to use a credit card, it’s always better if you play safe even if you expect money to pay the coming bills. After all, you won’t use your credit card if you have the cash.
  • Vacations – while it’s safe to go around without bringing cash with you, a credit card should never be your financial option in the first place when you are on travel. Basically, credit cards have huge credit limits which allow you to spend up to the limit. Most people forget about self-restraint and tend to spend up a huge amount of money during their vacation. According to some experts, you should not use your credit card for vacation purposes as much as possible. However, you can use it in case of emergency or if you know how to control this credit tool to your advantage.
  • Building New House – most people would go to get a loan for sure. However, some individuals do not know this one. When it comes to building new home or renovating an existing one, using your credit card to finance it wouldn’t be a good idea. A house is a huge investment that will take up a big amount of cash. So, getting money from your credit card or swiping it to get the items you need for the house is a bad thing to do. You can actually get financial help through loans or by borrowing money from your friends, relatives, or family members while negotiating a mortgage to finance it.

Limiting your use of credit cards is one thing. Focusing on one credit card is also another thing that will help you to avoid financial problems as you go on. Aside from limiting your expenses, you’ll also be able to pay off your dues with less difficulty because of the smaller amount you’ve used from the card. Instead of relying solely on credit cards, why don’t you look for alternatives that won’t pull you to the credit card debt trap? In case you don’t know, the trap includes a never-ending payment cycle that is often hard to get out from. After all, these cards aren’t your only option when it comes to finances as you can borrow money from other sources.

Credit cards are helpful credit tools as long as you know how to use them. In fact, lots of card holders are happy and satisfied with their cards when their finances are in good shape. But things are different when they start bringing in problems when cash is short and you need to pay them. However, you can’t blame the credit cards as you are the one who’s been using them for your benefit. Most of the time, overuse of the cards has been the main reason why many card holders are struggling financially. If you are a card holder, make sure to use it wisely.

Mortgage loans with a fixed rate

Home loans of this kind are the most popular in the market, their fixed rates serving as a buffer against uncertain times. Nevertheless as statistics show, at least several million of American people own houses whose cost falls below its present value. With that in mind, it is easy to see how hard the times have become even for those people who started off with a decent score and met the rest of the lender’s criteria.

Voices from the Background

The American society is considered very mobile, with many people swapping jobs or even careers several times in their life. Amidst the fears of the continuing crisis and questionable future stability it it the young people in the US and Europe that pay the biggest price. It is at their expense that the older generations can remain in a relatively undisturbed sleep. The student loans and increased tuition fees pushed many into the streets of London while unemployment rates had people occupy Wall Street to little avail. Interestingly enough, young people in the Tahrir square attain little and yet they are a force to be reckoned with. The old do not rebel and just cross the invisible line between integrity and self preservation whilst protecting their territorial gains.

All The People’s Loans

Thousands of graduates burdened with a student loan now seek refuge hoping to secure a roof over their head but to no avail as lenders shut the door in their face telling them to come back once a better credit score is established and overdue payments settled. That prompted many to default and ran off with no shame for integrity lost. That has become a standard for many today.

Security and safety are indeed key in today’s world but are hard to obtain and receive a lifelong guarantee. Same with mortgage loans that come with a fixed rate. At least if you have enough savings in your piggy bank you can relax knowing you have saved on insurance, but need to start saving yet again for a rainy day.

Mortgage loans with a fixed rate offer an illusion of stability and consist of the loan principal, lender’s profit margin that remains stable as well and the rate itself. There could also be an insurance sent to an escrow account if no or little down payment is offered. The most popular terms are 15 year and 30 year loans. The choice depends on you but obviously the longer it is the more cash a lender receives from you in interest.

Before going along with the first lender you have come across do not play it by ear just keep looking the best offer there is. Consider a broker if you must though with some time to spare and the internet search you are all set. If you cannot afford too much of a down payment take a look at some alternatives put forward by the government.