Many people get stuck in bad debt because they choose to ignore the signs of the problem. Indeed, there are always warning signs that point to the imminent disaster – bankruptcy. What are the major red flags of financial danger and how can you spot them? Here are some tips:
Using your credit cards for everyday purchases. Do you find yourself charging even the smallest purchases to your credit card? Do you often use your card to pay for unexpected buys? Do you need to use your credit card to buy or pay for necessities such as food, electricity, gas, etc? If yes, then obviously something is not right with your budgeting and you could be in danger of credit card debt build-up.
Making only the minimum payment. Do you tend to pay only the minimum required due payment of your credit card each month and choose to leave the rest of your balance? If you do, you are adding more load to your obligations. Remember that carrying a balance also means incurring interest rate charges which can range from 15% to as much as 20% of the original amount of your debt. Read more
