Credit Card Dangers: Don’t Sink into Credit Card Debt. Use a Small Personal Loan Instead
Credit cards come with inherent dangers. However, in emergency situations or to handle larger expenses you may be tempted to “charge it.” A small personal loan offers a safer option, protecting you from sinking into credit card debt.
Danger #1: Cycle of Unending Payments
Have you promised yourself to pay off your card each month, yet put it off paying the minimum payment only? Credit cards get reused which starts a cycle of unending payments. Interest and fees add up which increase the amount you originally paid for the items you purchased and decrease your ability to pay beyond the minimum, which never pays the card off.
The fixed payment plan of a small personal loan ensures the end is in sight. Your lending agency holds you to your promise of making specific monthly payments, removing the temptation to put it off or pay a bare minimum. And, with lower interest rates, loans keep your deals intact — you avoid paying well over the purchase price.
Danger #2: Unexpected Interest Rate Changes
Credit card interest rates fluctuate on the whim of the credit card company. These rates are variable which means the zero percent interest, promotional offer may leap to double digits once the promotion ends. This change could significantly impact your minimum payment and credit card debt.
Fixed interest rates on personal loans protect you against these rate hikes. The rate of interest on personal loans does not change. Plus, these rates typically start lower than those of credit cards. Fixed rates save you money and predictable payments help your financial planning.
Danger #3: Debt You Cannot Pay
The ability to charge until you reach your credit limit threatens to keep you in debt. Since credit card companies do not require you to pay the full charges each month, purchases and interest accumulate. Soon you are living well outside your means, living with debt you cannot pay.
Personal loans help you live within your means. No shopping sprees, regretted nights of partying or gambling binges which rack up unbudgeted expenses. A loan gives you a set amount of money to spend and a set plan for paying it back. Once paid off, a loan does not return to haunt you.
Solution: Personal Loan
By eliminating the dangers of credit cards, personal loans help your finances. They also protect your credit score. Your debt-to-savings ratio improves.
If you long to end your credit card debt, talk to us about debt consolidation options, and get out of the dangerous waters you are swimming in.
If you want to talk to us about applying for a loan please call Quick Loans on 0800 200 275 or simply apply online.
This is not legal advice.