Credit cards, with their feature of “spend first, pay later”, have become the preferred tool for many consumers to and pay. Not only do they allow us to easily complete various transactions without having to carry a lot of cash, but they can also provide capital turnover at critical moments, and many benefits such as interest-free periods, point redemption, and consumer discounts. However, while credit cards bring convenience, they are also like a double-edged sword. If consumers are not careful, they may fall into the credit card debt trap and face difficult problems such as high interest rates, damaged credit, and collection problems, which seriously affect their personal quality of life and financial situation. Therefore, exploring effective ways to avoid credit card debt traps and establishing rational consumption concepts have become important topics that consumers need to master.
The financial crisis that is quietly approaching
If a credit card is not fully repaid within the interest-free period, the remaining balance will be charged interest on a daily basis, and the interest rate is usually high. Over time, interest continues to accumulate, like a snowball. For example, Xiao Zhang used a credit card to spend 10,000 yuan, but failed to pay the full amount. He only paid the minimum repayment of 1,000 yuan. The remaining 9,000 yuan was calculated at a daily interest rate of 0.05%, and the interest in a months was as high as 135 yuan. If the repayment is delayed for a long time, the interest plus the late payment fee (the fee to be paid for overdue repayment) will rapidly expand the debt scale, making consumers overwhelmed.
In order to pursue a high-quality life and satisfy their vanity, some consumers rely too much on credit card consumption, buy luxury goods, go on high-end travel, etc., without considering their repayment ability. They believe that there will be enough income in the future to repay the debt, but ignore the various variables that may occur in life, such as unemployment and illness. Once the income is interrupted or reduced, it is easy to fall into a debt crisis.
The popularity of social media has accelerated the spread of information, and various consumer trends and On the web celebrity products have emerged one after another. Some consumers lack the ability to think independently and blindly follow the trend to buy popular products. For example, when they see an on the web celebrity recommend a certain electronic product or beauty product, they will buy it without thinking, regardless of whether they really need it. This kind of blind follow-up consumption not only increases unnecessary expenses, but may also cause waste by purchasing products that are not suitable for them.