America is a credit card nation, according to virtually every form of measure. We turn to plastic to purchase our daily living items, cover unexpected expenses and pay for family vacations. In many cases, Florida residents don’t even bother to carry cash throughout the day, and simply charge all purchases with the intent of paying the balance down at the end of each month. This approach, however, is just one of the many ways that Americans make mistakes with credit, leading many into staggering levels of credit card debt.
When a consumer fails to make their monthly credit card payment on time, a series of events begins. In many cases, a card issuer will use even one late payment as justification to raise your interest rates. In addition, the late payment will be reported to the credit bureaus. This in turn can lead to difficulty in gaining access to new lines of credits, or having to accept a higher interest rate on a new account.
Another common issue involves failing to pay down all those small charges that were made throughout the month. Putting your groceries and gas purchases on credit is only acceptable when you are able to pay down the entire balance each and every month. As soon as those purchases begin to roll over into additional months, the interest charges will grow at an astounding rate. Another common mistake is allowing your balance to near your available credit limit, which can wreak havoc on your credit score.
With the right measure of attention and self-discipline, many Florida consumers are able to regain control of their credit card debt and move forward with improved credit habits. In some cases, however, the problem has grown beyond an individual’s ability to adequately address the matter. For those who are facing an insurmountable level of credit card debt, the fastest path to personal solvency often lies in filing for bankruptcy.
Source: ABC News, “Top Credit Card Mistakes,” Adam Levin, July 28, 2013