Credit card debts: Causes and Prevention

CAUSES:
There are many reasons why people end up with more debt than they can possibly handle on their own. One of the main causes of personal debt is misuse of credit cards.

1) Don’t have credit card education.
Many people get their first credit card as soon as they are allowed to, when they are 18 or sometimes even younger. Many young people see credit cards as "free money" and buy up everything that they want without showing any concern of how they are actually going to pay for it.
2) Emergence of online shopping
With the economy making for a leaner wallet this year, consumers will still likely continue to overspend while surfing the Internet. The reason attribute to overspending on online shopping due to it become more user friendly and convenient to the user. Whenever the users have possessed a credit card, they can just buy the things through online.

3) Encouragement of credit card companies
Even the credit cards have encouraged you to spend money with no worries wherever you go, but the credit card companies have always sent the advertising to assaults you. Card companies often send their consumers all sorts of flyers and deals in the mail that give those individuals rewards and privileges that depend on spending more. It is often these things that hamper their ability to save their money.

4) Lifestyle maintenance
College tuition, cars and mortgages, luxuries house etc are the big expense along the way. Many people focus on one area of finances, neglecting the other so badly that there's not enough money to go around once these life events arise. Therefore, people may then rely on credit to get by.

PREVENTION:

1) Keep a running tally in writing of your weekly or monthly spending versus you budget, and update it before each purchase.

2) Use an online bank account to keep score of your spending. Keep your credit card receipts when you make purchases. At the end of each day or couple of days, use an online bank account to pay the credit card company for the amount you spent. Seeing your balance fall in line with your credit card spending should help you to keep to a budget, and eliminate risk that you overspend during the month.

3) Limit your credit card use to certain categories of spending. Use your credit card to pay only when there's no risk you will overspend. So use it for regular bills, groceries, and expenses where you trust yourself. For areas where you suspect you overspend or spend on impulse, use cash.

"Spending less than you make is what's important."