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The story behind credit card debts & personal loans

Any one with even an iota of interest in personal finance & its workings would probably know that credit card debts and personal loans are usually the worst kinds of debt traps that you can fall into. Yet many people fall into that trap again and again. Many people do come out of it eventually but some don't & this becomes a part of their "lifestyle".

 That you are eventually paying much more than you need to, if you default on credit card payments intentionally or unintentionally (probably @ 36 % per annum or something similar) or take a personal loan (say, @ 12% per annum or so) is not hard to fathom.

 However behind these numbers, there may be even a deeper story - that usually that of not having control over expenses or not having created a buffer amount. While there may be some pressing need like unplanned or recurring medical expenses which fuels sudden demand of money or an unexpected job loss, in many other cases this need may be fueled by lack of planing and indiscriminate spending, which may have depleted the non-existent much-needed financial buffer.

 Few examples of some fault lines one needs to be beware of -
  • Buying an expensive latest iPhone model, which creates a hole in your pocket.
  • The extra Rs. 10K you spent on partying through the weekend. And that alcohol overdose which made you fall sick for next 2 working days.
  • That luxurious European vacation you took which stretched your financial limits.
  • That ongoing home loan for your "investment" in home which takes a good chunk of your take home salary.
  • You bought a swanky new SUV and now your EMI burden is pinching you.
  • Buying the in-fashion watch because it is cool and there was a sale. And topping that with 3 jeans because there was sale.
  • Blew up some money in casino when I went to Goa with friends.
  • Loaned money to a friend who is yet to return it despite following up since a year.
  • Investing in stock markets because it gives "assured" 15%+ returns, as your friend told.


 There are many possible reasons, but hope you get the drift ...

 So, when you consider defaulting on your credit card bill because of cash flow issues or take a personal loan for whatsoever reason, do think why you need to take that loan in first place!

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Comments

  1. Sinu singh11:43 AM, July 10, 2018

    Good information for credit card debts & personal loans, thanks for sharing. Personal Loans

    ReplyDelete
  2. sandeep saxena12:52 PM, February 06, 2019

    Here i noticed many important points and mainly related to technology.thanking you for the good article.
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  3. Aryan Rajput3:00 PM, February 08, 2019

    Great post would like to know more on tips to avail personal loan in India.

    ReplyDelete
  4. Vicky Ram12:02 PM, February 18, 2019

    good work done and keep update more.i like your information's and that is very much useful for readers.

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  5. Amit Tyagi2:40 PM, March 14, 2019

    This blog is very random and a very interesting one. Getting a personal loan is pretty difficult for some people these days and you discussed an interesting scenario which might occur quite often! I have surveyed some sites on the internet and found out about Early Salary which provides personal loans & it is great. If you wanna know more simply visit there!

    ReplyDelete
  6. anushka4:54 PM, April 03, 2019


    Much obliged to you for sharing such extraordinary data. It has help me in discovering more insight about personal loan on credit card

    ReplyDelete
  7. Sachin Aamne8:36 PM, April 23, 2019

    Hey thanks for this amazing post. Would love to read more of such blogs. You can also have a look at personal loans online for more information.

    ReplyDelete
  8. arjun14:55 PM, May 10, 2019

    Thank you for sharing this information. It has helped me to know more about
    personal loan on credit card

    ReplyDelete
  9. Anonymous9:02 PM, May 20, 2019

    When my partner and I separated last year I was struggling to cope on my own with 2 kids emotionally and financially. With the help of a small loan from elijahcapitals@gmail.com Now I was able to get back on my own two feet again with less stress and in a steady time manner. Thank you once again for your kind service and helping hand.

    ReplyDelete
  10. Rakesh4:42 PM, June 04, 2019

    This comment has been removed by the author.

    ReplyDelete
  11. Derek jamieson7:44 PM, August 09, 2019

    thanks for the information
    likely loans

    ReplyDelete
  12. Maycee7:14 PM, September 21, 2019

    Great post! Indeed, credit card and personal loan debts are your worst enemies when it comes to your finances and how you manage them. But, I'm sure there is always a work around in case you find yourself trap with this type of debts. Just always know your options.

    ReplyDelete

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