Understanding credit cards and the business behind

This is an article based on my experiences using credit cards.

The basic idea of credit card is to make payment procedure easier, faster, and saver. How come ? By using credit cards, people should not carry huge amount of cash, which is placed them into criminal's target. Just sweeping the card and sign the bill, the payment was made.

But, now using credit cards can places the card's holder in a big trouble. Why ? Because they lost control of shopping, and forget that the amount was used should be paid back as soon as possible.

The due date

Every card has a print date and a due date. Print date means the date when bank prints the bill of all transactions was made by a particular card and send the bill to the card's holder. The bill should be paid before the due date. If the card's holder pays all of the total amount printed in the bill, the case is closed. But if the card's holder can't pays the total amount of the bill, he/she can pays only at minimum payment or more. The minimum payment currently is 10% of the total amount of the bill. The rest that hasn't paid yet will be charged by interest.

The interest of credit card is very high, currently is around 3.25% - 4% per month depends on bank's regulation. This interest is being main income of the bank that issues the card. Another incomes for the bank are annual membership fee, late payment penalty fee, cash withdrawal fee, joint venture card payment fee with another banks, and so on.

Cash withdrawal fee is special one. The amount of interest is higher than ordinary (shopping) interest. Currently, the cash withdrawal fee is around 4%-4.5% of the amount of cash withdrawal. If your withdrawal amount is too small, there is a minimum fee applied. Once you withdraw some cash, the day after the withdrawal day will counted as interest. So, there is no grace period for cash withdrawal in credit card usage. You should pay it back as soon as possible. Watch out !!

The Debt Collecting

If the card's holder can't pays the bill, the amount of the bill will be higher and higher. I think the bank has already spare some percentage of non performing loan to cover its business. So, what will bank does if you can't pay the bill ? Bank will hires a debt collecting company to collect the debt from you. As I know, if the debt collecting company can collects some money from you, 50% will belong to them, and 50% will belong to the bank. The debt collector will uses any ways in order to collects the money from you, including psychological pressure to you or even to your family. They have to push you to pay the bill.

How to use credit cards wisely ?

Some people decide to not to own any card at all. But actually we can use credit cards wisely. First, choose credit card from a well known issuer bank. Read some reviews and customer's complain in the newspapers or internet related with credit cards. Second, hold only one or two cards from high reputation banks, no more. Remember, each card will charges you an annual membership fee. Third, use the cards for emergency use or frequently scheduled expenses only. It means you're already budgeting some amount of money to pay the expenses. Paying using credit cards just to complement the way to pay in cash. So you should pay total amount of the bill and this will avoid you from interest. You have to do this consistently.

May be the bank will offers you some discount programs or other promo in order to make you spend more money and increase you credit card usage. But still, you have to control your expenses using credit cards.

The advantages of using credit cards

Based on my experience, using credit cards in order to buy airline's tickets will give you more advantages. Because if you buy a ticket using credit card, you will be covered by some amount of insurance. Another experience is when my family member has to be hospitalized, credit cards would be helpful in that kind of situations.

So, don't be afraid to have a credit card. What you should have just control and discipline of using credit cards. Peace !!

Get side job, increase your income !

As a father, we (men) are encouraged to increase our income in order to provide all of family member's need, including meals, education, clothes, recreation activities, and so on. But not just that physical need that should be provided, emotional needs also should be provided, such as feeling of financial secured that make you see smiles on your family's faces.

Some times it's so hard to find the correct side jobs. It's commonly happened that people got
side jobs with small income but lots of work, or high income but need much time that disturbing the main job time schedule.

What I did are tried to optimized the internet to drive income to me. For example, I've developed MateriKuliah.Com. This site by today get around 300 unique visitors a day. So it's start to attract sponsors to deliver income to me. Thank God.

Another way is using my domain name such as IndoDomainer.Com to drive new income through PPC (pay per click) scheme. It is listed on Sedo.Com by today and starting to generates traffic and income for me $ by $. Thank again Lord.

Also I've tried to wrote some articles and publish them in paid news services. So if my article be published and viewed hundred or thousand times, it will deliver $ to my account. The example is my article about Taiwan's presidential election. It's already delivers several $ cent to my account, and still increased. Another article still under review process and will be online soon.

The last way that I try to optimized is using Google AdSense. Actually, it's already generates traffic, but not yet delivers money. Just wait and pray. Also Amazon affiliate, I already listed as a member. It generated search, but not yet become transaction. No problem. We have to use all ways to complete our task as a father. Just pray and work. God will bless us.

Debt... how to handle it ?

I think every body have experienced of debt. Let's say debt of credit card, debt of cell phone bill, or debt of loan. Having debt or not-paid-yet bills is uncomfortable experience. We have to meet debt collector, arguments fighting, or even physical fighting with them, and answering rushed calls. When we have a debt, we're always thinking : it's so nice and peaceful without debt.

But how to handle debt ? Here is my suggestion. List all of the bills that you have to pay. List it from highest of amount ones to the lower. Then identify which ones are involve interest. List them from highest rate of interest ones to the lower. If you have debt without involving interest, such as loan from your parent, you can ask them gently to pending the due date. The most priority debts you have to pay are the debts which are involve highest rate of interest, such as credit cards. The interest of credit card are 3% to 4.5% per month ! This debt should be paid first.

If you don't have enough income to pay them, you have to think how to improve your income. But still, you have to press your expenses in order to pay your debts. Call the customer service, and tell your financial situation honestly. Best loan provider always welcome and help their customers in this situation. If you are not get solution, push your self to pay the debt and close the case. You can maintain good relationship with loan provider who give you the best solution.

I've experienced this kind of situation. I had 3 credit cards and used them to build my house. Then I should pay them back with their high interest. 2 years I and my family pressed our expenses to pay the bills. And thank God, 2 are fixed and closed gently, and 1 left in safe ratio. I realized that nowadays are difficult time for people not to get loans, since live expenses rises very fast. But still, we have to keep our financial resources in balance and safe ratio. Good luck !

How to manage income and salary

As a Christian, God has teach me to return 10% as my gift to His works in this world. So, here the way how I manage my income and salary.

First thing that I always did when I receive the salary or money, I prayed a thanks to God for giving me blessing and money to support our life. I also ask Him to bless the money to blessing my family with all good things we will do about the money. Second, I take 10% of total received money, and take it to the Church as our gift to God. Finally, I spread the rest of money into several post like for pay card bill, electricity bill, phone bill, etc. I also arrange some part of the money for saving, just in case me or my family member get an incidental case to pay out.

With this procedure, me and my family can cover all expenses that occurs in a whole month. May be you can use my experience to manage your income and salary. Peace !