Fast Five Credit Card Misconceptions - Marvin Germo
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Fast Five Credit Card Misconceptions

By: Marvin Germo | December 20, 2014

We have talked about credit cards and debt so many times in this website.  There is nothing wrong in using credit cards, however as what I always mention in all my talks, debt is like a two edge sword.  It can either help you if you know how to use it but it can also hurt you if you do not know how to use it.  The reason why people get hurt when it comes to debt and credit cards is because there is such a shroud of misconception when it comes to the use of credit cards.

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Catch me in my live training events! (quick plug)

The heart of why I do this seminars is I want to build a generation of Filipinos with the right foundation in stock investing.  I want to bring smart investing to every Filipino around the world! If you would like to know more on how you could time the market checkout the trainings below.

This is part of our Fast Five series that aims to break credit card misconceptions!  I believe that the first step to be financially free is to get out of debt!  And I really want to see more Filipinos move out of debt and into life!  I want to see a new breed of Filipinos who would know how to properly handle and manage their money well.  I believe this can be done and we will be seeing more and more of our kababayans financially free!

God bless you, Happy New Year and enjoy our “Fast Five Credit Card Misconceptions”

1.  The more Credit cards that I own the richer I become!

The more credit cards you have the more money the bank can lend to you.  At the end of the day it’s not your money it’s just the amount of money that the bank can lend you.  It’s not yours.

2.  My credit limit is the amount of money I own and is also the amount of money I can use!

Yes, it’s the amount of money that you can use but it’s not yours.  You are just borrowing money with a very very high interest rate. Credit limit does not equal your bank account.  If you have a credit limit of 150,000 Pesos, it’s just like me saying that I can lend you 150,000 Pesos.  At the end of the day you will still need to earn the money so you can pay me back.

3.  The higher my credit limit the richer and more classy I become!

The higher your credit limit, the bigger your chance to wind into even more debt.  You don’t become richer because you can borrow more.  That’s not true.  Wealth is defined by the assets that you have less all your debt.  Guess what, the higher your credit limit that you use the more you pile up your debt, the lesser your wealth actually becomes.

4.  I save money if I just pay the minimum every month.

You will pay more than 42% per year if you just pay the minimum while you are earning 1% from time deposits.  Even if you make 30% in the stock market but pay 42% to your credit card, you are not actually making money but more money is going out the window because of the interest. You will actually lose more over the long term because of this.

5.  I should use my credit card when I do not have the money or cash to buy what I want.

Only buy the items that you can afford.  If you cannot afford it or it is not in your budget, using a credit card to have it now will not help you.  This will bring you away from your goals of Financial Freedom.  Using debt to buy things that you don’t need is a step backward.

New book and other books on Investing, Business and Finance.

I’m excited to share my 5th book overall and the 4th book in the Stock Smarts series, Stock Smarts: Breaking the Resistance – How to time your traders perfectly. The heart of this book is to teach you strategic ways on how to come in and buy and sell stocks in a way where you come as the market is headed up and come out as the market is headed down. The book is now out and exclusive via Marvin Germo Book Orders.
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