This post might be a little bit abstract for some, and we definitely apologize. But sometimes we have to step back and look at how we mentally see credit. It’s nothing to get worked up over at all. The truth is that credit has a purpose and a role in all of our day to day lives. You can’t do anything without good credit. It’s downright impossible to get the ball rolling. What you’re going to have to do is make sure that you’re thinking about credit from an emotional point of view. When your mind is unsure about credit, your financial life is very static. It can’t grow because you’re going to have problems with actually using credit for what it’s intended for.
A lot of people believe that credit is an evil thing that needs to be destroyed. We can guarantee if you have this attitude, your credit life is going to be really, really short. You have to think about credit as a neutral tool. The media would like to make victims, and we don’t agree with that at all. The truth is that credit is a natural thing — it’s what you do with it that matters. Nobody is holding a gun to your head and forcing you to spend more than what you can honestly repay. If you haven’t realized it by now, life is very uncertain. So just because you have means now, doesn’t mean that you won’t get sick later. Life can really change in the blink of an eye. So you want to make sure that you’re protected as much as possible. This is even more the case when you have small children to look after. You want to do everything in the world to make sure that your children are well taken care of no matter what happens.
Having a credit card gives you options, but you still have to make the right choices. Just like you don’t want to sit down at the poker table after a long stressful day at work, you probably don’t want to go shopping with your credit card just to take the edge off. It might feel good to buy a lot of stuff, but do you really need it? Is it really going to help you get to somewhere else that you would really like to go? You have to be sure that you’re doing everything in your power to move things in the right direction. Otherwise, you’re just going to be spinning your wheels and feeling even worse about yourself.
Problems with credit aren’t something that you have to work out on your own. All residents of the UK have access to the Citizens Advice Bureau. They have a team of debt counselors that can talk to you for free about the best way to get out of debt and actually handle money.
It’s going to really make a difference when it comes time to buy a house. You probably want a house that you can call your own, and this is a dream that many people have. Why settle for not reaching your dreams merely because they’re difficult? While it’s true that you can pay for a house in cash, you’re going to be saving for a long time. It would be better to just save for a modest deposit and see what type of financing you can get.
As far as credit cards go — they aren’t evil. If credit cards are evil because they might lead to a lot of debt for you, then so are mortgages. Just because a mortgage is tied to an asset that you really dream about doesn’t mean that it can’t be dangerous when viewed under a certain light.
Give yourself plenty of time to sort through the credit card world. Again, if you’re someone that can’t handle credit well, don’t beat yourself up. While we were a little harsh in this guide, it’s only to illustrate just how important it is to begin establishing your own credit. Believe it or not, bad credit isn’t the end of the world. If you avoided bankruptcy, then you can build your credit life back up with no problem. If you haven’t been taught the ins and outs of finance, how can you do anything but fear credit? That’s the way we look at it. Most people are bothered by stuff that they really don’t know.
It’s better to look at what you can do instead of just ignoring all of the things that you can’t. You have to be aware of what’s possible, not just what’s feels impossible right now. This is why we say that credit starts out as a state of mind — you have to conquer your own emotions about credit before it becomes a tool that you will be able to wield successfully.
Don’t forget that you don’t have to leap into mortgages right away. Start small with a store credit card, or even a secured card. Charge small amounts and pay back what you owe. Don’t get swept into what all of your friends are doing. Everyone has different goals and once you know what you want — there’s really no looking back, is there? Good luck!