3 Sneaky Debt Traps to Avoid
We’re living through uncertain times right now. The COVID-19 crisis has changed the world as we know it. Thousands of people are out of a job, and lots of businesses have closed their doors. Since things are so unpredictable right now, it’s important to save money where you can. Keep your pockets full, and read about these three debt traps to avoid.
Timeshares
Timeshares are a terrible investment. A timeshare is a vacation plan where people own part of a property and can use it certain times throughout the year. It’s never a good idea to buy a timeshare because the continued maintenance fees and high interest rates are impossible for owners to keep up with. Most timeshare owners don’t realize how much money it takes to be in good standing in a timeshare contract. If owners can’t keep up with their payments, they can be subject to a timeshare foreclosure. A timeshare foreclosure can destroy a person’s financial future and affect their ability to get a loan.
Ponzi Schemes
Ponzi schemes are definitely a debt trap to avoid. So many people get wrapped up in Ponzi schemes every year, and social media in recent years has only made it the situation worse. So many social media influencers convince people to buy non-useful products all the time. Please, be smart before you buy anything or join any company. Don’t purchase magical protein shakes that claim to help people lose weight in a ridiculous amount of time. Moreover, don’t agree to sell such products, either. So many people get caught up in Ponzi schemes and pour money into them without knowing the real damage they’re doing.
Rewards Programs
Some companies offer rewards to customers who spend a certain amount of money at their establishments. Avoid these rewards programs at all costs. When people have incentivizes to spend more money, they will. Please, don’t spend more cash than you actually have available to you just because you’re hoping to get a “prize.” Credit card companies are notorious for these rewards programs. That’s why it’s so easy for people to accrue so much credit card debt—credit card owners try to obtain rewards and don’t realize how much money they’re spending while doing so.
