Top Three Reasons People Pile Up So Much Debt

Credit card debt and other unsecured debts have turned into a severe problem for the greater part of families in America . So many people have become to used to just using their card to get whatever they want, whenever they want, without really having the cash to pay for it. Below I will list the top reasons that people end up becoming so indebted with credit card debt.

1. Impulsive Buying and Bad Spending Habits!

Buying impulsively represents a lack of willpower. People will merely locate an item in a store and charge it on their plastic, all due to that they cannot wait to get, whatever item it is they want to purchase, regardless of whether they have the money for it then or not. Credit cards feed into impulsive buying that is what the cards are there for to keep happy our need for instant gratification. You know there is a aphorism “patience is a virtue” if some people adopted that principle they would not be in so much debt.

Undisciplined spending behaviors run along the same line as impulse buying. Some people just pamper themselves way to often in life. For example, somebody might end up at a four star restaurant, and instead of getting a chicken sandwich and fries, they order the prime rib, the appetizer or two, the happy hour special, and the dessert special. Par for the course they charge it on their plastic. Don’t take me out of context every once in a while splurging isn’t bad, but for some debtors it’s an everyday way of life. And these poor spending behaviors can stack up to a skyscraper of debt extremely quick.

My Advice: Upon the next time you find yourself at a store any kind of store, and you are going to make a purchase with your credit card. Think twice about the items you are about to purchase and think to one’s self ‘Are these items wants or needs?’ If you see yourself charging something that is more of a want then a true need then promptly put it back on the rack, and commit to yourself when you have actual cash not a plastic card, to come back and purchase that merchandise for yourself without charging your card. The key point here is to establish the difference between wants and needs, your groceries are a need, your toothpaste is a need, the new DVD system is a want, the brand new pair of sneakers are a want. A oil change for your vehicle is a need, a turbocharger for your vehicle is a want.

2. Holding Too Many Credit Cards!

This is the next major problem to people getting into heavy debt issues. People basically just cannot reject the credit card offers they receive in the mail. They get these offers in the mail saying your already approved and your line of credit is 5k. For some people this is too much to take on and they will graciously accept every card and promptly put them to use.

My advice: Just throw these offers away! You do not need them. Think of every one of these card offers you receive in the mail as a giant financial time bomb waiting to explode. The only way to cut it off is by placing them promptly into the garbage. Learn to turn down the new credit applications you do not need them, this cannot be stressed loudly enough.

3. Cash Advances!

This is a very big factor in people stacking up debt. It’s to easy to go to the ATM and take out cash against your card. However this becomes addictive to people and becomes a large reason why they pile up so much debt.

My Advice: Avoid cash advances. This really is almost the same as just paying on your card, because you still get charged interest and pile up a skyscraper of debt.

Steve Bis is a debt analyst and research assistant with the US Consumer Advocate, which primarily practices in credit card debt settlement.

- Steve Bis