Personal Finance

Don’t spend money you don’t have.

That line means a lot more than you give it importance. It is human tendency to over extend ourselves when we suddenly have access to limitless things or abundant resources. We see it happen everyday when we exploit Earth’s resources – more than we need to consume and end up hurting what little access the future generations have.

Similar concept but with more financial consequences – credit debt. Known to have surpassed $1 Trillion in 2017 the average credit balance in America is $6,375 up 3% according to Experian (one of the three credit rating agency’s).


This happens because people over extend themselves into spending more when they don’t really have liquid assets to pay for their expenses. DO NOT be that person who has to think –

A. If I make minimum payments, I can pay off my debt when I land that job.

B. I’ll take a loan and it should be alright.

The penalty of not making payments on time and in full may not be realized now but imagine this – you spent $1000 to get a $200 bonus during your Thanksgiving shopping spree because those shoes and laptop you were eyeing were a steal. You didn’t have $1000 in your bank account and you aren’t going to get that $200 cash back off until you pay off the $1000 – you’ve already cornered yourself. Sure, you can make minimum payments but now you start adding to the debt you accumulate.

Making minimum payments is NOT good for your credit record. It tells banks you’re more likely to default than pay in full and on time. Thus preventing you from future applications.

Another situation where you keep making minimum payments for a year. By now, you would have accrued thousands of dollars in pending payments. You suddenly have to travel home for an emergency. You have to choose – pay for your tickets or pay off the cards? You can’t postpone the payment anymore else you run the risk of default and major interest rates on repayment.

Don’t let it come to that situation and spend wisely planning your budget. Don’t over extend yourself more than you have to unless it’s an emergency. Here at TheCreditTraveler we seek to inform you of the options you have as a consumer. We aren’t pushing you towards loading up on multiple credit lines but more to maximize your value derived. We highly urge you to be prudent with your expenses and investments. If it is a challenge for you, better stay away from artificial credit than run the risk of failure.

If you have any further questions, please contact us and we’d be more than happy to help you clear those doubts.

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