Causes and Prevention of Credit Card Debts(week5)

Credit card debts are resulted when a consumer of a credit card company purchases an item or service through the card system without paying off the debts by accumulating the debts. As a result, the penalties for not settling the payment as well as interest go up.

The main cause of credit card debts is people cannot reasonably measure how much he or she has spent. The reason is due to they cannot physically foresee the money is flowing out from their hands. They perceive that they are not paying the money from the moment and they will keep on buying. As a consequence, the money they spent will end up in credit card debts.

People pile up credit card debt by increasing their spending without considering their income for a host of good reasons. With the advancements in every walk of life in today's world, every piece of electronic equipment or a household item or a fashion update has an increase in cost making the average monthly expense go sky high. The salaries don't increase the sameway and people with less income purchase more on their credit account and get hold of credit card debt.
Gambling is America's new entertainment. Everyone likes to gamble with the money they have. How many come back home with a bag full of cash, very few. The guarantee in this game of chance is that you will be definitely paying to the house. Gambling loans are also available which lead to debt

The prevention of credit card debts is simple, just set up a Direct Debit for the minimum amount and pay off as much of the remaining balance as possible to keep the debt low.
Besides, the smart card user only uses the card in place of cash, or to obtain a purchase they can afford, if they can pay off the cost over time. In other words, the smart card holder only spends what they can afford.

The user should never ever hold more than eight cards at any one time, as this will adversely affect credit ratings. Clear any outstanding balances and cancel cards that are no longer used. Police advise shoppers to only carry one card at a time to reduce the risk should their card be stolen.

Develop a monthly spending plan. It is important to know where your money is going. Hundreds of dollars are spent on unnecessary things and when there isa need of purchasing a required commodity you just don't have any cash left and use a credit card frequently ending up in debt. In case of debt, debt management must be adopted.A monthly plan is no more difficult then writing down your income and expenses. You are in control of your money when you make thoughtful decisions about where and when to spend your money.

If debt is growing, there are four things card holders can do immediately:
1.Move debts to the lowest interest rate available. Remember, a card holder with a good credit rating can always ring and ask the credit card company for a lower rate at any time.
2.Prioritize paying off the most expensive debt first, so interest is kept to the minimum.
3.Assess their situation fully, work out their income and expenditure, and total their debts and assets.
4.Take this information to a professional body offering free debt advice.
5.If a card holder is having major difficulties making repayments, say after losing their job, their first port of call should be the credit card company. Companies would far rather help at this stage than when the situation has escalated. Card holders can discuss freezing the card and paying off the debt at an agreed amount each month, for example. Card companies are surprisingly willing to help in cases of genuine difficulty, but this will involve major budgeting and belt-tightening by the card holder. Then they should consult a professional.

There are plenty of debt consolidation firms offering to help, but do bear in mind these companies ultimately make money from a card holder’s debt. There are four main agencies that offer free, impartial advice for those in debt: the Citizen Advice Bureau, the Consumer Credit Counselling Service, National Debtline, and Payplan. These are non-profit making organizations that guide those in debt through the options available to them.

When debt has got out of control, the two major options are an individual voluntary arrangement (IVA), and bankruptcy. Never consider these without consulting the free debt agencies and/or a professional insolvency practitioner first. These are serious actions with wide-reaching consequences for future credit applications of any sort.

With the introduction of bankruptcy, the credit card companies are concerned regarding this issue where the consumer purchases as many things as possible without even considering the debts they accumulate by declaring bankruptcy. With the declaration of bankruptcy, the credit card companies are required to forgive all or much of the debt, unless such discharge of debt is successfully challenged by one or more creditors, or blocked by a bankruptcy judge on legal grounds irrespective of creditors' challenges. Due to the forgiveness of debts reduce the likelihood of making profit and continue its business, the credit companies are willing to offer another deal to the consumers which is in the border of bankruptcy. This deal consists of removal of past late fees and penalty charges, and re-aging the accounts so that the credit agencies see them as late accounts to enable clients to offset their debts.

The threat of online security: How safe is our data? (Week 4)

With the evolution of the Internet, e-commerce is very popular in the consumer behaviour. From the Internet, we can learn how to do the e-transaction and purchase from the net. Human tend to depend more on online convenience and along came another revolution of crime and security issue where some unethical users commit acts of crime on the World Wide Web. Every unprotected online computer can be affected with the viruses, malware, adware, hackers’ attacks and Trojans. There are several online security risks that can lead the users to serious monetary loss, information thievery and the attack on their computer.

The best way to overcome those problems is to use one of the many antivirus, antispyware, and firewall programs on the market; beside that also make that no anyone will ask for your password, account number, or other log-in information via e-mail or instant message. Beside this, to protect our data is safe we also can have an antivirus program to scan the entire computer for viruses. Even though most antivirus programs have an auto-protect feature that should, theoretically, prevent the insertion of a virus onto our computer, because it’s still a good idea to scan our computer periodically in the event the automatic protection feature missed something. Moreover, we can scan our computer once per week.

Furthermore, The solution for us how to protects our data for the online security, we need to uses the security issues to help us to protect our data, such as Authentication, Authorization, No repudiation, Confidentiality, Integrity, and Availability.