Something on credit card debt information firstcreditfix com
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Dont Save When You Are in Debt.
 Humans are funny creatures. We don't always do whats best for us - rather, we do what feels best, and try to blot out any reasons why it may not be the right thing to do. Perhaps that's how come there are so many people who have both savings and debts.
Its a Matter of Psychology.
Sure, it makes you feel better to save. Saving feels like you're constructing a base for your future, while paying off what you owe feels like you're giving your hard cash into a hole. That money is for the kids future, or for improving your house, or whatever else - and it's in an account gaining a valuable rate of interest. What can be unreasonable about that? A great deal, if you owe money.
Dont Be Fooled.
There are almost no savings companies that will give you interest rates as high as the ones credit cards take from you. Heres a question: if you have $10,000 in a bank account realising 5% a year and $5,000 on a credit card at an interest rate of 20% per year, how much hard cash do you have? After just five years, the answer is effectively zilch - what you owe would have grown to around $12,500, the equal total that your savings are now worth.
You may not think it now, but it really is a great deal better to pay off your debts. If you utilised half your savings to pay off that debt, youd be in a much better situation that it's really astounding. You avoid five years of compound interest on the debt, but you still get to hang on to $5,000 in your bank account, pulling in interest - after five years, that's approximately $6,380.
If youd still prefer to keep your savings intact instead of using them to pay off your debts, ask yourself this simple question: is your pride worth $6,380 of your familys hard cash?
Think of Your Financial Health.
When you have sufficient money to pay off your debt, theres absolutely no earthly reason to hang on to it. Debt is for people who don't have the money, and need to borrow it. Debt costs money, and savings make money - you want as much of your finances as possible to be savings, not debts. If your savings account and credit card are with the same financial institution, then youre in effect paying for the privilege of borrowing your own money from them. Why on earth would you do that?
There are more benefit's to lowering your debt with your own savings. Youll be less worried about your debts, and your credit report will show that you were able to pay everything back - resulting in getting you a much smaller interest deal if you should need to go into debt in the future.
I know it can be hard. You just have to be mindful that any cash you've saved hasnt actually been saved at all. Its money you should have been spending rather than buying with a credit card. Yes, it feels much worse to spend money thinking that youre spending away your future - but always remember that whenever you use a credit card to spend that same amount of money, youre spending away your future, plus interest. In any event, if you've got the debt, then that money has already been spent - stop denying it to yourself.
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