Consumer Debt and Financial Security
Financial Basics
It is very important to understand Consumer debt and how you can become financially secure. The most common forms of consumer debt are credit cards and payday loans but there are certainly other forms as well. Credit Cards and Payday Loans are unsecured loans and often come with higher interest rates than your typical secured loans such as car loans and mortgages. Why do payday loans have higher interest rates? Well payday loans are not secured against a home or a car and there is much more risk to the lender — so lenders charge higher rates to help mitigate the risk.
It is equally important that you keep credit card and payday loan debt under control as it can add up over time and become a financial burden to you and your family. PLEASE use these loans as intended; as a short-term solution for emergencies only. Payday loans are not intended as a solution to a long term financial problem.
By only using payday loans sparingly you can keep your overall debt ratio low and thereby become more and more financially secure. You will then have extra money to spend on things that are important to family, such as a car, a house, food, etc.
If for any reason your debt becomes to much of a burdon to you, there are resources that readily available and people who can help. One such solution might be Consumer Credit Counseling. Consumer Credit Counselors help educate consumers on how to avoid incurring too much debt and how to pay off any accumulated short-term debt. Start by looking up the nearest Consumer Credit Counseling service, in your area.
