Lesson 60 of Personal Finance

American credit card debt 

America is one of the countries with the most credit card debt especially in places like new jersey and alaska. Credit card are a form of revolving debt. You can borrow up to a maximum limit of money on a recurring basis. The amount of money you can borrow is based on multiple factors such as income and credit card score. More purchases using credit cards are being made more often. While credit cards are a lot easiest to use they also have many downside to them. Compared to cash it seems a lot easier to use a credit card because you don’t have to actually see yourself handing over part of your paycheck. It takes a lot of self restraint and control to be able to use a credit card responsibly. Most don’t stand what it feels like to be debt free but instead live in the mindset of “it’s just 20 dollars” while being in six figures of debt. When being in debt you are pretty much owned by your lender. They have the ability to come and repossess  things such as cars, or houses if not paid on time. 

Compared to other loans such as mortgages, vehicle loans etc. credit cards are very high. When you have mortgages and fail to pay them on time the mortgage loaner will come take the home. When you have loans on a vehicle and fail to pay them promptly the loaner will come and take the car. But when you have a credit card the laner can’t take the credit card. To carry a credit card it takes a lot of trust not only in yourself but the loner has to trust that you will pay on time.

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