Dealing With A Depressing Credit History
There’s a good reason why there are people who don’t recommend debit cards over credit cards. While a debit card may be a good option for people who just can’t seem to control their spending, it doesn’t improve a person’s credit history. After all, it’s essentially a cash card with added features.
This is why, even with all the bad things said about credit cards, it is still a good idea to get one. Building a good credit history opens up opportunities for substantial amounts of loan later on. It opens up a means of getting leverage for starting a business.
On the other hand, the dark side of owning credit cards and incurring debts, in general, is that there’s really no way of assurance that each of them will be paid. Circumstances that are outside of a person’s capacity to influence may prevent them from paying off multiple debts. One notable example is when a company decides to let employees go.
Obviously, anyone who is suddenly left without their only means of earning will be at a loss. They are likely to be thinking more of where to get food for the next couple of weeks than paying off their debts.
After picking up the pieces and establishing a frugal lifestyle, a person who is riddled in debt should then start to consider debt consolidation. When a person decides to consolidate multiple debts, they are mentally prepared to take the route of fully restoring their credit score. The convenience of being able to pay multiple debts to just one channel not only makes things easier overall but also helps the person with bad debt deal with the problem with less stress.
Of course, it’s best to remember that debt consolidation is merely a tool. Being responsible with finances and living within one’s means is still the best way to ensure a good credit score for the long haul.