Credit Card Debt
Credit card debt is the worst debt available. Well, I suppose there are some loan sharks and title loan companies that are worse, but on the whole credit card debt is A #1 terrible.
It is so easy to get in credit card debt. You can go over all your budget goals, hopefully you have them, and create a slowly sinking ship.
The thing about credit cards is that they are tricky. The interest rates are always way higher than what you would pay anywhere else. The interest adds up to a lot of money. The average person will pay around $200.00 per month on credit card interest a month. It is enough money to make you have a much larger retirement nest egg.
Credit cards do things like charge over the limit fees, late fees, transfer fees, and more. If you default on one card it can make all the cards go up. Some cards can jump from a low rate of around 8% and then up to 35% with a single late payment. It doesn't matter if you are one day late. The credit card companies are playing a game with you. Since the credit card company creates the rules, you can only guess who the loser is going to be.
Congress has recently made new laws to stop credit cards from some of their unethical practices. Some of the new laws do not allow for double cycle billing, over the limit fees, or targeting college students with no income. In the meantime, credit card companies are coming up with new ways to make up for the lost revenue. There are right now creating new tactics to get your money.
If you have any amount of debt, in most cases, the credit cards should be paid off first. The reason is that they most often have the highest interest rates and involve lots of hidden costs.
If you have ever had a debt problem, simply do not use credit cards. Statistics show that 95% of people get into trouble with them. You might be the exception, but probably not.
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