Many people who are in financial trouble today started on that journey with the help of credit cards. Why? The simplest answer is that paying with plastic is easy. The purchasing power regardless to whether you can realistically afford it becomes hypothetically guilt-free. Using a credit card enables a consumer to buy now and essentially worry later.

The problem is that later comes in a few short weeks with compound interest added each month onto the amount credited to you. Many consumers commit another detrimental mistake – by only paying the minimum due each billing cycle. Unless you pay the credit card bills in full each month, a good portion of your hard-earned money will go to paying on interest alone.
Unfortunately, many people do not realize that this is a honey trap. Theoretically, it looks as if you are doing the right thing –you are after all paying the credit card bill on time and paying the minimum due. What you are actually doing is stepping into a vast sea of quicksand from where there is no reprieve.

When facing credit card debt it can take a relatively short amount of time to find yourself overwhelmed by outstanding credit card bills that you just cannot afford. What can you do? How do purge yourself of the bad habits that obstruct your financial health.
First, you must understand that credit cards are useful. However, that is only if and when the bill is paid in full each billing cycle. Otherwise, they are pure poison. You must internalize this is truth deeply into your mind. Before using your credit card, it is a necessary step to ask yourself- “Can I honestly afford this when the bill is due?” Honesty to you is the key. If you cannot afford it at the moment chances are you will not be able to afford it when the bill is due. It is imperative to be aware of the financial horror that shopping impulses can create especially when repeated month after month.

Here are a few credit cards SOS you could apply to your life immediately:

1. Keep aside all but one credit card however do not close any accounts. Keep only one in your bag/ wallet to use sparingly and only in emergencies. For day-to-day necessities, use a debit card. Debit cards have similar uses to credit cards however are limited by real-time available balances. In other words using a debit card enables you only to spend the money you have available. Remember: ONLY use your credit card when you are prepared to pay the full amount due at the end of the billing cycle.

2. Contact the credit card provider(s) in order to re-negotiate the repayment terms. You will be pleasantly surprised that most credit card providers are very reasonable and cooperative as long as they see this is a genuine problem. It is important to show that there is a willingness to settle your balance.

3. Transfer the outstanding balance to lower interest loans. Try obtaining a loan to liquidate all of the outstanding credit card debt. Whatever the bank interest might be, it is definitely much lower than the interest amount the credit card providers are charging. Alternatively, switch to a provider who offers lower interest rates, until you find a way to raise enough money to pay the credit card bills.

4. Debt consolidation. Do not be afraid or ashamed to ask for help. Very often, debt consolidation can help you out of a very messy situation with the least amount of stress. A debt consolidation company works on your behalf with companies in order to re-negotiate your repayment terms.

5. Raise money through personal loans. While not always the most popular option it may be worth asking friends for loans in order to completely repay the outstanding credit card debt. The most important factor is to eliminate the debt at all cost. Now is the time to regain your financial stability and learn new habits for continued financial health.

As a student, there seems to be an expectation that life should be worry-free and that money can be spent with no regard or planning for tomorrow. Mistakenly millions of students have carried this mentality. However, they were sobered soon after graduating when they found themselves surrounded by debt.

A key element of the adult world is financial stability. Using some simple money management tips students can learn to stay financially fit. Learning to manage money while in college enables students to confidently enter the mean, cold world.

1. Stay organized. Use a calendar to keep track of due dates. This helps ensure that payments are made on time. Stay informed on any available scholarships to keep track of their application deadlines. As scholarships are funds that do not have to be paid back, they can become a vital aspect of funding a college education. Organization encourages positive money management.

2. Establish an emergency fund for yourself. Emergencies and college life are synonymous. An emergency can have a devastating crippling financial effect. Having an emergency fund provides a safety net. Set aside 15-20% of all money into this fund. You will be happy that you did.

3. Invest your savings. As a student, there is less financial pressure than that of an adult with a family to support. Therefore, you have more of an advantage now and freedom to take risks with your money. This encourages hands-on learning on matters regarding various investment options. Make your money work for you. Researching investment institutions helps to get the most out of your money. Speak with financially stable friends, consult professors, use the internet for research and when possible take risks and experiment. What you learn will be vital in the future.
4. Share instead of buying whenever you can. Do not rush to buy books or equipment unless it is mandated that each student have their own. Try sharing such resources with your classmates. The more you share, the more you save. Establish a “common resource club” where everyone makes different items available so everyone can benefit from their use.

5. Take a part-time job. Wherever and whenever possible try to self-finance your college expenses. Actively look for employment around you; however, performing freelance work over the internet is also a great option. It is important that you do not place all the financial burden on your parents shoulders, even if they can afford it. It is an amazing feeling to be financially independent.

6. Stay away from credit cards. If you want plastic money, use a debit card. Nonetheless, use it with as much caution as you would a credit card. One of the major causes for financial distress after graduation is the careless and irresponsible use of student credit cards. Be careful here, you are playing with fire.

7. Stay away from frivolities. Yes, yes – student life is supposed to be a fun-filled life where frivolous expenses play a very important role. However, if you apply the ‘get value for your money’ concept to such expenses you will see how misplaced such concepts are. Spend and save your money wisely and you will lead a financially stress-free life.