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You should also control from having a large amount of unpaid outstanding credit or using more than 80% of your available credit (which causes a high debt to income ratio).
It is better to have a debt free life without having a savings rather than maintaining debts along with savings. The reason is simple. As
return on short term investment i.e. savings is lower than interest payable on accumulated debt, it is always advisable to pay debt first rather than go for short term investment. Because a repayment of single debt instantaneously may save a lot of money in future. In other word, One dollar payment is better than one dollar saving.
From Consumer Debt so published by Federal Reserve Statistical Release, it is found that each and every year total consumer debt (both revolving and non-revolving) has an increasing trend. In 2000 and 2001, total consumer debt has a rising trend by 11.42% and 8.04% with respect to year 1999.
However, in 2002 and 2003, total consumer debt increased to 4.45% and 4.52% respectively, at a decreasing rate with respect to just previous year’s total consumer debt. As there is no specific trend in total consumer debt we may conclude that in 2005 also, total consumer debt will have an increasing trend of 4.49% which signifies that at end of 2005 total consumer debt will reach about $2109.85 Billion.
For better insight in this topic please view: http://www.debtconsolidationcare.com/getoutofdebt.html http://www.debtconsolidationcare.com/debt-solution.html http://www.debtconsolidationcare.com/debt-free.html http://www.debtconsolidationcare.com/help.html
Janet Williams is a contributing Writer to http://www.debtconsolidationcare.com/ And is currently working on a special section in the site called do it yourself where you can eliminate your debts and become debt free...
