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Credit Cards - a Powerful Wealth Tool

In fact, when used properly, credit cards arehate  me.
a very powerful wealth-building tool! I use
credit cards for every single possibleSo why do banks go all out, giving freebies
purchase.and spend millions of dollars in advertising
to hook you on using their card? They know
By  using  credit  cards  you  get...that there are many consumers out there who
just pay the minimum sum every month (about
1)  A  two-months  interest  free  loan3% of the total debt you owe), because it is
so tempting. What's worse is that many credit
When you buy a product using your creditcard owners don't even pay their minimum sum
card, you will only be billed for it at theon time because of a cash crunch or because
end of the month. You are then given anotherthey  plain  forgot.
month to make payment. So, if you pay off
your total bill, you would have effectivelyThe moment you pay only the minimum sum and
gotten  a  two-month  interest  free  loan.allow your outstanding balance to roll, you
become the bank's best friend. This is when
2)  Bonus  points  and  dollarsthey will make a killing off you! Why? This
is because banks charge a 2% per month
Each purchase you make on your credit card(s)interest on your outstanding sum. This may
will earn you bonus points which you can useseem small, but again, that's 24% interest a
to redeem for free products and services likeyear. Just how much interest does this add up
extra flyer -miles and dining vouchers,to?  Let's  do  the  sums...
saving  you  even  more  money.
Question: Imagine if you had an outstanding
3) A monthly statement that tracks andbalance of $2,000 on your credit card
consolidates  all  your  expensesstatement, and you just pay the minimum sum
of $60, how long will it take for you to pay
At the end of every month, the credit cardoff the while balance? (this is only assuming
company will tabulate for you the totalyou  do  not  charge  a  single dollar more).
expenses for the month, making it easy for
you to track your total expenditure. So itThe shocking answer: It will take you 4.5
becomes  a  free  money  management  tool.years! You would have paid a total of $3,300,
that's $1,300 in interest. In other words,
However, you MUST ALWAYS PAY THE OUTSTANDINGyou would pay an actual interest rate of 65%
BALANCE when you pay the full balance everyoff  your  balance.
month. This way, the bank does not earn a
cent off you, but you get the three greatSo when used properly credit cards can
wealth building services mentioned above.greatly assist you in creating wealth or it
This is what I do and that is why my bankerscan destroy you if abused.



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