What can result from mismanaging credit?

Mismanaging credit can lead to getting into debt, which is a common consequence when individuals do not use credit responsibly. This typically occurs when someone spends beyond their means, accumulates unpaid credit card balances, or misses payments, leading to late fees and interest charges that increase the total amount owed. Over time, this can snowball, resulting in a substantial debt load that may become unmanageable.

In contrast, increased savings, improved credit history, and enhanced budget control are outcomes associated with effective credit management. When credit is used wisely, individuals can build a positive credit history, leading to better loans or interest rates in the future. Additionally, smart credit management can help maintain or improve a budget, as individuals manage their expenses in relation to their income.