Proper Handling of Credit Cards – Renaud Laplanche


Entrepreneur Renaud Laplanche observes that most people who are struggling with financial problems can trace their troubles to the handling of credit cards. These cards may be small enough to fit in your wallet or slide into your shirt pocket, but the power that they hold over your finances is unfathomable. Most people do not have control over the way they use their cards, and they find themselves misusing them all the time. In the United States, many families are living in difficulty because of this, and that is the reason they have to know how to get back to the right tracks.

Beware of the Rates

The reason many people end up with a lot of debt on their cards is that they do not care about the fees payable when using them. Different companies have different kinds of fees, and you have to check with your card provider to find out how much you will be paying. In addition to that, you should know the interest rates that you will be subjected to when you use these cards. By doing this, you will find out that you spend a lot of dollars every year paying for fees and interest rates. It is something that you can avoid.

Avoid the Endless Debt Cycle

A typical situation when you have debt on your card is to find a way to pay and become debt free. At least, that is what experienced financial experts recommend. However, it is not what the average household does. A closer scrutiny shows that they live by accumulating debts on their cards, and when they pay, they start borrowing some more. It becomes an endless routine that makes them live in debt forever. Inasmuch as it gives them a financial lifeline, it is a dangerous trend. Have you ever thought of what would happen when you accumulate more debt than you can pay? The same companies will advocate for a poor credit score and that will be the beginning of even bigger problems.

The Incentives

Most people also get trapped in credit card expenditures because they are attracted to some sort of incentive. These companies have reward programs that can be irresistible. However, there are always terms attached to them. Most of the time you will have to spend money on some items to get these rewards. It may feel good to vet something for free, but you are spending unnecessarily to get it, you probably are losing more. For example, you will notice that you do not even need the items that you bought yet the debt on your card has doubled. You have to take time and decide if the incentives are worth it.

According to Renaud Laplanche, credit cards have become one of the most painful parts of the financial stories from across the world. He says that it is time people reconsidered the way they use these cards. If they are going to be the reason you are both in debt and with a poor credit rating, they probably are not helping you.