Thursday, September 17, 2009

Credit Card Woes

Are you one of the people who pay credit cards on a minimum amount?

Do you know how much it is costing you to pay on minimum amounts only?

Well, I am asking these questions now since so many people are caught up on credit card woes and they don’t know how the credit is piling up because of billed finance charges, credit shield premium and insurance from the banks. Without sufficient information and knowledge we keep on paying our credit cards with minimum amounts only. We feel that it is easy and convenient. Yes it is easy and convenient but we are not aware of the dangers in might cause us?

Have you ask yourself lately how long you want to pay all your credit cards? Until you are in Dubai, until you are working, or all thru out your life? I will show you how it is being calculated

Let say for example that this is your credit card details

Opening Balance AED 3, 898.03
Credit card payment (Minimum) AED 217.00
Billed finance charges AED 117.54
Credit shield AED 22.79

If you will calculate, the minimum amount paid was 5.57% of the balance as informed to you when you applied for the card then less the billed finance charges (3% of the balance) and the credit shield so you are only paying AED 76.67

This is how it is:
AED 217-AED 117.54-AED 22.79= 76.67 AED will be deducted to AED 3,898.03 * 5.57% again to get the minimum amount that you will pay on the next month.

So you see how it is swallowing you whole. If we continue doing this, how long we have to pay the 3000 or 4000 AED we borrowed from the bank. Maybe 50 years?

My point is we must know and we must act and pay our credit cards higher and settle debts as fast as we can.

I hope this insight will help someone out there who is in trouble of their credit cards.

1 comment:

  1. buti na lang kahit isa wala akong credit card :)
    kundi busog na ang bank for swallowing me whole! hehehehehe!


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