Credit Card Debt: The Causes and Prevention

What is credit card? Credit card is a card that provides holder with credit to make purchases up top a limit fixed by card issuer( Eg: Visa and Master card).I believe this word or term is very common to all to all of us. Do you have credit card debt? This is something that can very easy get out of hand and credit card reduction should be something that you are always try to accomplish. There are some credit card causes and several suggested ways to prevent you overspend and get your debt under control:

Causes of Credit Card Debt:

1)Poor finance management: This is the most common reason why many people have accumulated credit card debt. This is because people are unaware to conduct a monthly spending plan and do not keep track of their monthly bills. Thus, they will not realize that they overspend snd lead to a rising in debt.

2) Unexpected unemployment and salary deduction: Due to the economy crisis and financial hit that happend around the world, many people are unemployed due to organizational downsizing. Moreover,some of the company have to deduct the employees salary to decrase the organization expenses. Households are forced to use the credit card for groceries, utilities and other expenses purpose to maintain their current lifestyle and some of them can't find the job in short period. Thus, this may cause rise in debt.

3) Gambling: Nowadays, gambling has become an entertainment activites in our daily life. It is hard to stop when it becomes addictive. Thus it will surely lead to a finacial disaster if boorowing money through creditcard for gambling.

4)Habit of purchasing branded goods: Some people are like to purchase the branded goods because they think that the branded goods will represent richness and status. Generally,most of the branded goods are very costly or expensive. Hence, it will lead to overspend.

Ways to Prevent Credit Card Debt:

1) Have a saving plan: This is key to help you to protect yourself from getting into debt. It is important to set a certain amount each month into a saving account. It can just be for general savings or you could set a goal to save up for a big purchase. Saving with a goal in mind motivates many people to stick to their saving plan. Then, at the end you will be able to purchase the desired object without going into debt.

2) Making a budget: You have to create a clear budget and stick on it that includes monthly bills, foods, clothes, entertainment and miscellaneous expenses will prevent from overspending and fall under deeper debt load.

3) Self control and discipline: One of the best practices is to have a direct set up so that able to pay back the full amount each month and use in emergencies. Hence, self control and discipline to keep these cards in wallet and would not overspend. Prevention is aware of the causes of credit card debt and start to spend less in order to stay with well in financial situation.