Using Credit Wisely

To help you stay financially healthy you need to understand credit.

Posted by Avail Content
6 years ago

To help you stay financially healthy you need to understand credit.

Credit is access to money that belongs to lenders (e.g. individuals, institutions, finance companies). It offers you the ability to purchase items or services that you cannot pay for right now in exchange for agreeing to pay at a future date—with interest.

The problem with credit is three-fold.

  1. Credit can give you a false sense of financial health. Lenders will often extend credit whether or not it is good for your financial situation.
  2. Many people don’t consider the final cost of a purchase when interest is taken into consideration, particularly if only minimum monthly payments are made. Interest charges add up quickly and can create a financial burden that it is hard, and sometimes nearly impossible, to overcome.
  3. If you take a long time to repay a debt, the lender is happy because they make a lot of money on interest. However, your cost will be higher and you will undoubtedly make more purchases during that period of time.

Here are some important things to note about credit

  • Borrow only what you need and can afford. If you can’t pay off a debt quickly, you can’t afford it. It’s as simple as that.
  • Credit is “sold” to us by persuasive marketing strategies that promise happiness and convenience.
  • Credit card companies establish low minimum monthly payments or low introductory rate offers to maximize their profit, not to help you.
  • Ultimately you need to ask yourself, can I afford to take on this debt? And if I do, what other opportunities am I giving up in exchange (e.g. the opportunity for stress-free living, more time for enjoyable activities because you can spend less time earning an income, money to put towards savings and retirement funds)?

Learn More

For more information about financial well-being, the following resources may be helpful.

Interested in speaking with a Care Professional on Avail?

Search Care Professionals
Smile

Are you a Care-Driven Organization?

Avail can provide you with real-time insights on challenge areas and resource consumption patterns for your people. Book a demo today to learn more!

Book a Demo
Problem
Avail for
Company
Headquarters
SASKATCHEWAN
10-2220 Northridge Drive
Saskatoon, SK S7L 6X8
Contact Us
Account

Our Trusted Partners

fs
amplify
sky recovery
2b
zero
physical
aspire
coverging
hcd
lead
Primary Icon

We're on a mission to empower people to live healthier lives by providing actionable health and well-being insights through data analysis.

If you or someone you know is in crisis, these resources can provide you with immediate help.

Using Credit Wisely

Last updated 6 years ago

To help you stay financially healthy you need to understand credit.

Credit is access to money that belongs to lenders (e.g. individuals, institutions, finance companies). It offers you the ability to purchase items or services that you cannot pay for right now in exchange for agreeing to pay at a future date—with interest.

The problem with credit is three-fold.

  1. Credit can give you a false sense of financial health. Lenders will often extend credit whether or not it is good for your financial situation.
  2. Many people don’t consider the final cost of a purchase when interest is taken into consideration, particularly if only minimum monthly payments are made. Interest charges add up quickly and can create a financial burden that it is hard, and sometimes nearly impossible, to overcome.
  3. If you take a long time to repay a debt, the lender is happy because they make a lot of money on interest. However, your cost will be higher and you will undoubtedly make more purchases during that period of time.

Here are some important things to note about credit

  • Borrow only what you need and can afford. If you can’t pay off a debt quickly, you can’t afford it. It’s as simple as that.
  • Credit is “sold” to us by persuasive marketing strategies that promise happiness and convenience.
  • Credit card companies establish low minimum monthly payments or low introductory rate offers to maximize their profit, not to help you.
  • Ultimately you need to ask yourself, can I afford to take on this debt? And if I do, what other opportunities am I giving up in exchange (e.g. the opportunity for stress-free living, more time for enjoyable activities because you can spend less time earning an income, money to put towards savings and retirement funds)?

Learn More

For more information about financial well-being, the following resources may be helpful.