Don't fall into the debt trap: consider your options before signing up for a credit card

                                                                                         

The ever-mounting problem of debt seems to have hit an all-time high in the UK, with an increase of 10.4% - or £110 billion - over the past 12 months. People are spending more than they can afford, and the rate at which they're doing so indicates it will be harder than ever to decelerate the trend. Many continue to spend money they don't have, while others are instilled with fear that credit cards are bad news - putting them off applying for one in the first place.

However, there are ways to avoid debt, as well as to avert existing credit slumps. For starters, recognize that owning a credit card is not 'asking for trouble' - because in actuality, there are a number of benefits to owning and using a card. They allow consumers to build credit, enabling credit-based purchases - such as your own house - in the future. They also allow for occasional large-scale purchases like a car or a holiday. However, there are various steps the consumer should take to ensure remaining debt-free.

One of the necessary steps towards obtaining a credit card is to do a bit of research on all the available options. There are countless offers out there; but what makes one better than the other? You can start by researching some of the bigger credit card companies, as they often have an extensive range of credit deals on offer. However, you can gain an even more comprehensive view of the credit card market by turning to credit card comparison sites. Either way, you'll gain access to valuable information which will help you make an informed decision. If, for example, a credit card offers a remarkably low interest rate for the life of a balance transfer, it may end up being a better deal than if it were to offer a zero per cent rate for the first six months followed by a high rate for the remaining life of the balance. Making such comparisons will help you understand your options and, in turn, make the most informed decision to suit your financial requirements.

However, the most effective way to dodge debt is to spend responsibly. While credit cards enable you to build credit as well as make large-scale purchases from time to time, they should not be considered as a means of buying things you can't afford. Moreover, it can be easy to lose track of your spending figures, and subsequently rack up debt, if you're constantly swiping your card. Therefore, it's wise to keep good records of your credit card finances and to refer to your figures on a regular basis - to double check accuracy as well as to manage your finances. Furthermore, you should disperse large purchases in order to give yourself a chance to pay them off. By researching for the right card and spending responsibly, you'll not only be able to continue making such purchases - you'll also have a sparkling credit record.

About the author:
You can start by researching some of the bigger credit card companies, as they often have an extensive range of credit deals on offer. However, you can gain an even more comprehensive view of the credit card market by turning to credit card comparison, sites.

Martin McAllister is a freelance online journalist. He lives in Scotland.

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