Buy now and pay later - the advantage and disadvantage

Credit cards enable you to purchase items you can't necessarily afford straightaway. You can buy whenever you need to, and repay for as long as you want. You can purchase several things at once, spend in a number of outlets, treat yourself, make yourself feel good. But the bottom line is this. Whatever you buy now, you will have to pay for sooner or later. If you are spending beyond what your income could normally afford, if credit cards didn't exist and you had to pay cash, then you are potentially storing up great problems for yourself which can only adversely affect your quality of life in the future.

'Buy now pay later' was one of the early advertising slogans for hire purchase finance back in the sixties. A concept with great consumer appeal, but one which, with the explosive growth in credit and store cards and consumer credit in general today, has left an enormous number of the population with a worrying amount of debt that is proving very difficult to reduce and eliminate.

Credit cards are best used to make purchases which you know you can clear when your monthly pay cheque is banked, or for those more costly purchases like a holiday for example, which you have budgeted to repay over a period of months.

If you make indisciminate purchases, buying on a whim, and don't repay most or all of your purchases at the month end, then you stand a good chance of getting yourself in a right old financial pickle.

So....

• Pay off more than the minimum amount on your statement each month.
  
  
• Don't lend your card to family and friends.
  
  
• Keep a record of all the purchases you make, and keep and total up all your receipts.
  
  
• Moderate your spending. Don't buy just to feel good or because you haven't reached your credit limit.
  
  

And, finally, if you do overspend, max out your card and don't have the cash to make the regular monthly payment, never, never, never pay off one card using another.