Is Credit Card Debt "Neglective"? Do you think this is not a good thing?
The average UK credit card loan interest rate is now 16.32% - about 11.5% higher than the current benchmark interest rate, but this is only the average; in fact, some cards can charge more.
If we use the imaginary (but not unrealistic) scenario of a person with a credit card debt of £3,000 at a rate of 16.32%, then to repay the debt for one year, the monthly repayment will be £272.65 and there will be About the same amount of interest paid.
Of course, credit card companies don't like you paying off your bills so soon because they don't have that much money. Instead, they prefer a high monthly balance account, with small payments each month.
According to the terms and conditions of the loan company, using the same 3,000 pounds of debt as the interest of 16.32%, the minimum payment will be around £45 per month. But by paying the minimum amount of 45 pounds, it takes 176 months or more than 14 and a half years to fully pay off the debt, and the final amount paid will be around 7920.00 pounds - far more than twice as much as the first place!
So it is easy to understand why credit card companies are more willing to pay the minimum payment and how quickly consumers' credit card debts get out of control. This is especially true when you realize that all you need is a simple phone call to increase your borrowing, when the credit limit has been reached. If you keep a minimum fee, card companies are usually happy to help consumers shoulder more debt.
In 2005, the number of UK credit card holders was only 59% per month. This means that as many as 41% of card users are paying the minimum repayment amount, and using the above example we can see that the perceived potential for currency loans is very strong.
So it's no wonder that credit card companies are eager to lend more money. If you have credit card debt, then you are not alone.
Once you admit that you do have a debt problem, what choice do you have? Realizing that the problem is the beginning of understanding, understanding is the first step to solving the problem, so the most important thing is not to bury your head in the sand.
The obvious thing is to either spend less or make more. I don't know if this is easy, and it may take some creative thinking to achieve it, but once the additional funds can be used regularly to pay back as much as possible, and eliminate the annoying credit card debt again and again and for all .
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Orignal From: Get Rid of Nasty Credit Card Debt
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