Credit cards are one of the major royalties of debt. In fact, it is estimated that an average American household with at least one credit card has nearly over $15,950 in credit card debt. Furthermore, recent data revealed that the sum of credit card liabilities in the U.S. amounts to roughly $850 billion as of late 2013.
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The staggering extent of financial liabilities plaguing the country cultivates the assumption that paying a credit card debt is an overwhelming responsibility. Consumers have become wary that most debts are unmanageable. However, this is a non sequitur. Successful debt management is only a matter of savvy financial practices.
When managing payments, cardholders are given an option to pay a “minimum payment due.” It is best to be wise when dealing with minimum payment as it forces debtors to pay more in succeeding transactions, which may even cause the amount of interest to surpass the initial debt.
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The key is to predict interest rates. If you are expecting a significant amount of money for the next month, it is okay to pay a minimum for at least two succeeding months. Just remember not to stick to a cycle of paying a minimum for three or more consecutive months.
If you are handling multiple credit cards, fight for the lowest rates and target paying a card at a time to avoid balanced interests among two or three different cards.
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Rod Aycox is a well-known financial specialist, entrepreneur, and philanthropist. He is the founder of LoanStar Title Loans, which presents financial solutions to individuals seeking financial stability.