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RISING WOMEN EXPERTS...
Before things start to get out of control for me financially, I need
some advice on how to manage my credit. Do you have any good tips?
By Marlene Darby of Darby Mortgage Solutions Inc.
Almost everyone in Canada has a credit card or, in a lot of cases, more
credit cards than they need to have. Some people also have lines of credit
and, more recently, Home Equity Lines of Credit have become quite popular.
How do people manage all that credit? How do you handle your credit? These
are very common questions, and I pleased you asked!
I would suggest everyone do this little exercise. Take all of the credit
cards you have open, including the lines of credit and other “loans” you may
have and add up the balances owing. Now figure out how much “interest” you
are paying on all of those credit cards and loans. Are you surprised?
When you decide to use your credit cards to purchase goods/services, stop
and think. Do you really need that pair of shoes, or that bigger screen TV?
Is it a “need” or a “want”? Most people would say that spending on their
credit cards is impulsive and they are caught up in the moment as something
might be “on sale” and they feel they have to have it. It is okay to use
your credit card for purchases such as these but remember, you will have to
pay for that purchase down the road. If you can pay off the balances on your
credit cards every month, that’s great. But, if you are a person, like
thousands of Canadians that can’t pay off that balance at the end of the
month when that credit card bill comes, then you should take a good look at
how you are using your credit.
If you do not pay off the balances on your credit cards every month, it
means you are paying interest on the items that you have bought. How much
interest? Well, it could be anywhere from 9.5% on a “low interest VISA card”
or as high as 29.9% on that Bay or Sears card that you have. Most VISA and
MasterCards are around 19.5%. So, now that purchase you bought for, let’s
say $100.00, is going to suddenly start costing you $100.00 PLUS the
interest each and every month that you do not pay that off.
Add up all the interest charges you are accumulating on every credit card
you have; I am sure you will be amazed at how much your debts have increased
just by not paying off your balances every month.
For more practical advice on credit management, contact Marlene Darby,
Accredited Mortgage Professional & Paralegal & owner of Darby Mortgage
Solutions Inc. at 403.456.6471 or email
madarby@telus.net
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