Credit Tips & Pitfalls From The National Foundation For Credit Counseling

BOSTON (CBS) - Financial tips are everywhere; newspapers, magazines, TV and radio. Financial journalists and their editors love them. They often are given without much thought as to how they may affect the consumer in the future.

To understand how what appears to be a good financial move can work against you, the National Foundation for Credit Counseling (NFCC) compiled some tips and reviewed them to see if they would result in a financial tip or a pitfall to be avoided.

These tips seem good on the surface, but if not handled properly can have negative consequences.

As always I needed to add my two cents worth to the mix.

Let's start with one issue many listeners have asked about.

Discontinuing the use of credit

• Tip: Try living on a cash basis. No credit cards. You will never overspend or pay interest on your purchases. Typically, people who pay with cash save 20 percent over those who charge their goods and services.
  

• Pitfall: At some point in your life, most people will need access to credit. Consumers will be well served by creating a positive credit file. To do so, it is necessary to have at least three open and active lines of credit.
  

• Dee: All that is very true, but you need to learn to manage your credit and pay off your credit cards every month. And some of your everyday money transactions will require a credit card.

Shopping online, renting a car, reserving a hotel room, qualifying for a loan. Most of us will need to borrow at some point in our lives for we cannot save enough money for a house, car, business start-up or a college education.

Be a grown up here and use credit as a money management tool.

There are pros and cons to every financial decision we make!

The National Foundation for Credit Counseling (NFCC) is the organization I recommend most often to listeners whenever they tell me they need help with credit card debt. It has many local member agencies that it can recommend.

In:
• Anthony Silva