The Right Ways to Use Credit Cards this Christmas

A lot of consumers fall in to deep credit card debt right after Christmas. No one can really blame them because indeed, it is easy to lose control in the midst of the crazy holiday's shopping. However, being stuck in debt is a credit card blunder that can cause financial ruin if not rectified early on. But consumers don't have to end this way if they know how to handle their Christmas shopping. Using the right ways to use credit cards this Christmas, consumers can have a wonderful time without the debt.

Shopping at Sales

One way to save money during shopping is by buying items at a discount. During Christmas season, sales and discounts are plenty and this is the right time to buy all the gifts they'll going to give. Sales can be found in the malls, garage sales, thrift shops, and even online.

Setting a Budget

If there is one thing that should be clear during Christmas shopping that is the budget.People must determine early on how much will they be willing to spend on each present. This may depend on the kind of presents they have in mind. Some may come cheap and some expensive. But regardless, people must list everyone that needs gifting and they should write the amount of the corresponding gift.

During shopping, they must stick to their budget and avoid charging unnecessary things. This will cause impulse buying and they would end up regretting this shopping crime later on. By sticking to the list people don't lose the discipline and will to keep away from debt.

Redeeming Points

If a consumer has diligently earned points throughout the year, Christmas would be a good time to redeem them. This can tremendously help in saving for Christmas presents because the rewards may give gift certificates or discounted shopping at select stores. Gift certificates can mean free shopping. In this case no credit cards will be involved thereby saving a consumer from debt. In some cases, prizes can be in forms of items. The consumer has a choice to whether gift the item or save it for himself. Either way, he won't have to use his credit cards to buy gifts.

After the holidays, even if a consumer managed to escape the troubles of deep debt, he would still accumulate some debt from his other charges. The best way to get out of this fast is by paying on time and in bigger amounts. This shall finish off the debt in a short span of time.

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Sean Teahan co-founder of Cash Doctors,Australia's preferred short term lender, shares his insights on money matters. Founded in 2005 Cash Doctors has helped thousands of Australians with their fast cash loans but that's just the short term solution. Cash Doctors also help people in the long run by providing budgeting tools, e-books and individually researched articles on money matters and financial tips. The aim is to assist people in achieving instant and long term financial freedom.

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How Do I Calculate Finance Charges?

By Peter Kenny -

Having some knowledge of how to calculate finance charges is always a good thing. Most lenders, as you know, will do this for you, but it can helpful to be able to check the math yourself. It is important, however, to understand that what is presented here is a basic procedure for calculating finance charges and your lender may be using a more complicated method. There may also be other issues attached with your loan which may affect the charges.

The first thing to understand is that there are two basic parts to a loan. The first issue is called the principal. This is the amount of money that is borrowed. The lender wants to make a profit for his services (lending you the money) and this is called interest. There are many types of interest from simple to variable. This article will examine simple interest calculations.

In simple interest deals, the amount of the interest (expressed as a percentage) does not change over the life of the loan. This is often called flat rate or fixed interest.

The simple interest formula is as follows:

Interest = Principal × Rate × Time

Interest is the total amount of interest paid.

Principal is the amount lent or borrowed.

Rate is the percentage of the principal charged as interest each year.

To do your math, the rate must be expressed as a decimal, so percentages must be divided by 100. For example, if the rate is 18%, then use 18/100 or 0.18 in the formula.

Time is the time in years of the loan.

The simple interest formula is often abbreviated:

I = P R T

Simple interest math problems can be used for borrowing or for lending. The same formulas are used in both cases.

When money is borrowed, the total amount to be paid back equals the principal borrowed plus the interest charge:

Total repayments = principal + interest

Usually the money is paid back in regular installments, either monthly or weekly. To calculate the regular payment amount, you divide the total amount to be repaid by the number of months (or weeks) of the loan.

To convert the loan period, 'T', from years to months, you multiply it by 12. To convert 'T' to weeks, you multiply by 52, since there are 52 weeks in a year.

Here is an example problem to illustrate how this works.

Example:

A single mother purchases a used car by obtaining a simple interest loan. The car costs $1500, and the interest rate that she is being charged on the loan is 12%. The car loan is to be paid back in weekly installments over a period of 2 years. Here is how you answer these questions:

1. What is the amount of interest paid over the 2 years?

2. What is the total amount to be paid back?

3. What is the weekly payment amount?

You were given: principal: 'P' = $1500, interest rate: 'R' = 12% = 0.12, repayment time: 'T' = 2 years.

Step 1: Find the amount of interest paid.

Interest: 'I' = PRT

= 1500 × 0.12 × 2

= $360

Step 2: Find the total amount to be paid back.

Total repayments = principal + interest

= $1500 + $360

= $1860


Step 3: Calculate the weekly payment amount.

Weekly payment amount = total repayments divided by loan period, T, in weeks. In this case, $1860 divided by 104 weeks equals $17.88 per week.

Calculating simple finance charges is easy once you have done some practice with the formulas.

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Peter Kenny is a writer for The Thrifty Scot, please visit us at Unsecured Loans and Bank Charges.

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2 Highly Effective Financial Abundance Principles

By Matt Zavadil -

The average person never receives a proper financial education when it comes to succeeding with personal finance. Understanding that, how in the world will you find success when it comes to your own financial abundance when you've never been taught all the correct financial principles?

Whenever you see someone struggling to keep their personal finances together, it's because they haven't followed the steps that lead to success. Don't feel bad if this has just described you and your life to this point. You can turn all this around by simply following the next couple of keys that lead to prosperity. It really isn't all that hard. It just takes a little dedication to your future happiness.

The very first strategy you must understand is the importance of paying yourself first. Don't you always find a way to get your rent or mortgage paid each month? You put food on the table and make sure your kids have clothes to wear, right? But you don't pay yourself first. You must start doing this. Don't make the mistake of counting on your job or the government to help you retire. In this new day and age, most of us are on our own.

So, pay yourself first. Every single month, set aside a part of your income toward your future. Don't use the excuse that you have nothing left to work with. You don't tell your mortgage company this excuse, so why are you telling your future self this?

If things are really tight at the moment, there are companies that will allow you to start investing into an IRA for as little as $25 a month. If things are so tight that even $25 is too much, then you have some serious life choices ahead of you, such as discovering ways to increase your income stream.

You'll also want to put a little away into an emergency account so you can eventually lay off the credit cards. Which leads into the second personal finance rule. Right away, make sure you make getting out of debt a huge priority for yourself. Debt is financial cancer. There's no other way to say it. You must make it a priority to pay off all debts and then stay out of debt.

If you want financial abundance, you need to change your mindset when it comes to debt. Our society has become one that accepts debt without question. This must change for you and fast. It's not all right to go buy that big screen TV on credit just because you don't have the discipline to save for it first.

Think of debt as the way that you rob your future self of life, liberty and happiness. Yes, it's that important. Unless you want to never retire, work until your dying day and become a bitter person looking back, develop a plan to get out of debt today.

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Matt Zavadil: Take the two keys to financial success you've just learned and make getting out of debt your top priority at this time in your life. Once you finally get out of debt, then use those old payments to pay yourself first and fund your retirement.

(ArticlesBase SC #3319847)

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