This article explains how you pay off a credit card before liquidation or owing anyone anything including banks during these difficult times.
If you didn’t already know it, the world is in a mess. The latest statistics from the US tells us that 60% of the population lives from paycheck to paycheck. In my opinion, for a country that brags being the richest country in the world having such a high amount of people under the poverty line is shocking. Unfortunately, in many cases they are not only living from hand to mouth, they are also in debt.
The reality is that regardless where you are living globally becoming debt free is going to be a requirement to survive. The best survival strategy is if you work everyday, you live within your means and save the rest. If you have debts you are at risk of going under fast.
Does credit card debt go away?
The starting point is that unless you pay your credit card debt it never goes away. There are some statute of limitations on credit card debts in the US as well as other countries. However, this only means that your debt may not be seen on your credit report or influence your credit score. This may sound great, but some banks may still ask if you have had debts outstanding or even investigate your credit beyond your credit score. So, making sure your credit card debt is paid is vital if you want to take a house loan in the future or any other large purchases.
How to become debt free?
There is an attitude that comes with being free of debt. It is fine living in the moment. However there should be a consideration that the future will catch up with you in the end.
Just for five minutes consider what you have purchased that you really do not need?
It comes down to not buying stuff you do not need or even really want. Once you stop spending you will start to realize how to manage your income. You can also stop stressing about how you are going to pay your monthly bills. In the past I have had the situation where I am paying previous months bills just to keep on top of everything. At the same time expecting to maintain a lifestyle that I could not afford. When I think back, it was about instant gratification which was enjoyable at the time until the next day when I understood how much I had spent.
Modern day debt and serfdom
The key to paying off credit card debt is educating yourself to be smarter about your finances. When I have discussions about our personal finances I like to use the quote from the English 19th century Charles Dickens. He believed that there was a relationship between good money management and happiness, he said that:
Annual income twenty pounds, annual expenditure nineteen six, result happiness. Annual income twenty pounds, annual expenditure twenty pound ought and six, result misery.
Charles Dickens
This simply means that if you spend more that you can earn you will be unhappy. However, the situation in Victorian Britain was very different to today. Most average people could not get loans from banks and there was little in regards to social welfare and support. So, this philosophy was vital to stop people falling into poverty.
Today’s society encourages people who can not afford credit to take as much as they want until they are unable to pay. In many ways the ease of being able to get a credit card is like mediaeval serfdom in Europe. Where the tenant farmer would be bound to their landlord and forced to work for them. Having large credit card debt forces people to work longer hours and rely on a job they hate.
Once someone understands what situation they are in it becomes somewhat easier to change the way we think and behave. So, if you want to build a nest egg then it is time to learn the fundamentals of money management.
After you settle credit card debt, should you invest?
Unless we are running a business, you are working for someone else. We start working when we are young and believe that we can spend every penny we earn. Even when we are young we understand that it is not good to fall into debt. At the same time we know that we should save something for a rainy day. So, once you have repaid your credit card debt consider saving some money by doing some investments. However, before you start any type of investment educate yourself about it.
I don’t want to invest money but want to manage my money
We return to the same subject of educating yourself by reading books on financial planning so you can become money smart. If you have a family, learning how to handle money can be quite an influence on your children. If your kids see you struggle with money but still manage your finances it will give them a good basis for their own financial futures.
Using the services of a credit card settlement agency
One of the many options available to people owing money is a settlement agency. The role of the credit card settlement agency is to help create a payment plan that works for both parties. The agent normally has a good relationship with banks, bailiffs and creditors so they are able to make a good deal for those in debt. Often those who try and make a deal with the creditors independently find they will not benefit. Using a professional service can sometimes help you with your credit score in relation to any repayment plan.
Educate yourself out of debt
Nobody know the future.
However, we can see our hard earn cash being stolen everyday through:
- Bailouts for banks
- The valve of our properties
- Interest rates.
- Rising inflation rate.
- Unemployment.
The only weapon you have is to empower yourself and be enlightened about how you pay off a credit card. The last thing you should be doing is blaming the world, the government or even the credit card companies. You are not a victim. Finally, it was your choice to use a credit card and spend more than you could afford.
Today it is up to you to take control.
Can you settle credit card debt?
Of course you can if you really want to make changes in your life.
It starts now.
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