Credit card can be a very convenient tool to represent cash to purchase goods and services, but it can also be very harmful to us. Usage of credit cards has been a very common issue in this society; households, workers and even students are using it, by most of them using it without thinking of thinking of the consequences that could bring to the users. This is because the advertisements are showing the advantages of using credit cards only, which are the happiness that it could bring to your friends and families; but it will never show use the effects and consequences that can bring harm to us.
One of the reasons of people use their credit cards without thinking much on the consequences is that, they could be lacking of knowledge of how the interest charges is applied. They might not know that the interest is charged on the balance that they have not repaid to the bank. Furthermore, some people spend without proper planning and budget. The debts accumulate from time to time, getting more and more, until the user cannot afford to repay. Some people did not aware that they have spent too much by using the credit cards, which is more than they can earn. In addition, most of the students might be too optimistic about the earnings that they could earn in the future, and have too much confidence in settling their debts in the future.
However, the positive thinking, lacking of knowledge and poor money management could harm us and cause us bankrupt. Therefore, it is very important to manage your finance effectively. We should use the lowest interest rate's credit card. Furthermore, we should have self-control at the time we decide to buy the goods or services or not. Before we buy the goods, we should ask ourselves some questions, "do I need it?" "Is it an essential? Or luxury?" Moreover, limit the the credit cards in our wallet, or avoid bringing credit cards out to shopping. This makes sure that we will not spend more than the cash that we have. We should pay the balance in full and on time, so that no extra interest will be charged on the balance.
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