2008 Woodie Awards
Signs of credit abuse
Laura Burke
Issue date: 4/12/06 Section: News
- Page 1 of 1
Most of us have credit cards. We even use them for everything. But look at these statements, and evaluate if your behavior goes beyond "the occasional" dilemma. Answer true or false to the following statements:
1. Life would be terribly difficult if they took away all my credit cards.
2. I pay my bills on time, but I have to keep using my credit cards because I run out of cash between paychecks.
3. I'd love to get a consolidation loan and pay off all my charge cards.
4. I usually borrow from friends and relatives to make ends meet each month.
5. When I come home from shopping, I usually hide the things I bought so my family won't see them.
6. The balance in my savings account is shrinking, and it's hard to save money.
7. I'm a good juggler. I can always find a way to put off paying a bill so I can pay my charge cards on time.
8. I have at least two Visas and two MasterCards.
9. I've used the cash advance on one credit card to make payments to my other credit cards.
10. I usually pay only the minimum monthly payment on my cards.
If you answered true to six or more of these statements, you may be in trouble.
Build credit and build a strong credit score because we all come across obstacles in our paths, but lenders are more cooperative and generous with interest rates to someone with good credit.
Possible solutions for some of the above problems might be:
1. Limiting yourself to two or three active credit cards, cards you use on a regular basis. Either cut up the others, or throw them in the freezer. That doesn't mean cancel them, just don't use them.
2. Borrow from a bank before family and friends; money not repaid can have very negative impacts on relationships. If you must, draw up a contract stating how you'll pay them back with interest.
3. Put change in a jar and deposit it once a year. It may not be much, but at least it's a little something saved.
4. Use a line of credit from a bank or credit union before resorting to cash advances; the interest rates are very pricy.
1. Life would be terribly difficult if they took away all my credit cards.
2. I pay my bills on time, but I have to keep using my credit cards because I run out of cash between paychecks.
3. I'd love to get a consolidation loan and pay off all my charge cards.
4. I usually borrow from friends and relatives to make ends meet each month.
5. When I come home from shopping, I usually hide the things I bought so my family won't see them.
6. The balance in my savings account is shrinking, and it's hard to save money.
7. I'm a good juggler. I can always find a way to put off paying a bill so I can pay my charge cards on time.
8. I have at least two Visas and two MasterCards.
9. I've used the cash advance on one credit card to make payments to my other credit cards.
10. I usually pay only the minimum monthly payment on my cards.
If you answered true to six or more of these statements, you may be in trouble.
Build credit and build a strong credit score because we all come across obstacles in our paths, but lenders are more cooperative and generous with interest rates to someone with good credit.
Possible solutions for some of the above problems might be:
1. Limiting yourself to two or three active credit cards, cards you use on a regular basis. Either cut up the others, or throw them in the freezer. That doesn't mean cancel them, just don't use them.
2. Borrow from a bank before family and friends; money not repaid can have very negative impacts on relationships. If you must, draw up a contract stating how you'll pay them back with interest.
3. Put change in a jar and deposit it once a year. It may not be much, but at least it's a little something saved.
4. Use a line of credit from a bank or credit union before resorting to cash advances; the interest rates are very pricy.
