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Compounding Interest

15 Signs That You Are Going To Have Credit Card Debt Issues

Are You Holding On To Any Credit Cards?

(Image courtesy of LotusHead of

If so, have you been making payments (in full especially), for your credit purchases, on time?

If you are not and just making the payments for the bare minimum and having signs that you are going to default the next few payments, then these are some signs that you are going to have Credit Card Debt Issues!

The Problems Associated With Credit Card Debts

With all the perks offered for having Credit Cards, there’s also the negative side to having them especially if you are one of those who have issues making full settlement on time. Time also has a part to play because of the existence of the interest rate and this interest rate is compounding!

To have an interest rate compounding on your outstanding debts can be quite scary in the long run… Imagine just have a debt of $1,000 and an annual 24% per annum Finance Charge imposed on this amount. And there’s the common practice of using 2% (24% divided by 12 months) per month to compound.

So your actual outstanding loan per month will be like this:

  • First Month $1,000 + $1,000 x 2% = $1,020
  • Second Month = $1,040.40
  • Third Month = $1,061.21
  • Fourth Month = $1,082.43
  • Fifth Month = $1,104.08
  • Sixth Month = $1,126.90
  • Seventh Month = $1,149.44
  • Eighth Month = $1,172.43
  • … Twelfth Month = $1,269.07

From the mere of $1,000, the debt grew to $1,269.07 at the end of a year. And what I have shown you is just a simple illustration of a small loan debt (is your usual debt usually this small?) and that you are not going to make any further credit card purchases (is it possible? are you able to avoid the temptation?).

Along with a growing Debt, there’s also the other problems like:

  • Your Credit Score being affected – you may not be able to take up loans in the future (even if it’s a time of emergency)
  • Your Savings Affected (together with your Financial Objectives) – if you do not get out of this situation fast, your long-time savings may get used up fast, resulting in you not achieving your Financial Objectives.
  • No Peace Of Mind – just think of the number of letters you will be receiving for late bill repayment or even personal calls checking on your financial situations.
  • Lifestyle Affected – at times like this, you may find it hard to ask for loans from your friends or family. It’s not their fault. They do have their own financial commitments.

If you do not wish to be facing such issues, you must be aware of these:

15 Clear Signs That You Are Going To Face A Credit Card Debt Issue

Read More »15 Signs That You Are Going To Have Credit Card Debt Issues

The Factors To A Comfortable Retirement

Are you prepared for your Retirement?

Most people will say no, that’s no surprise, because to these people, Retirement Planning starts only at the last 5-10 years of their working life. Whatever they have by then will determine the kind of lifestyle they will live during their Retirement. And also a risk factor to consider is that a sudden high expenditure during Retirement will deplete this amount drastically, leaving the future really uncertain…

So should you be noticing this kind of situation, and you do not wish to be in it, then it’s time to take into considerations to a comfortable retirement.

The Factors To A Comfortable Retirement:

1. Time

2. The Interest Rate

3. The Lump Sum Amount

4. Budgeting

The First Factor – Time

Read More »The Factors To A Comfortable Retirement

Watch Out For Your Credit Card Loans And Outstanding Debts

Are you currently having a loan? It can be of any type – Credit Cards, Policy Loan, Student Loan, Car Loan as long as you are owing money.

And are you keeping watch of the compounding interest rate on those outstanding loans, especially those that charge you 5% and above? If you are not doing so, it’s better to wake up, dig out those accounts and clear as much as possible!

Reason being that Compounding Interest Rate can be both an Angel or a Devil working for you!

Why Such A Serious Note?

Read More »Watch Out For Your Credit Card Loans And Outstanding Debts