On a credit card...that is the question!
Now that 2011 is quickly coming to a close, it's the time of year where I start thinking about what financial goals I have in mind for the year ahead. So some of my upcoming blogs will be ways to help you start 2012 off right, and make financial goals and stick to them. Like I have said I am no finical expert, but I feel that as an average person I have the same money stresses as other ordinary people. These are things that I have done in the past that has got me to a point where I don't have to stress over money all the time. I am not rich, just an average middle class girl...just like most of you :) Hopefully you can find some things to get on track for 2012!
Today we will talk about the good and evil of that little piece of plastic in your wallet....CREDIT CARDS!!!
How many credit cards are sitting in your wallet right now? More than 3? If so you may want to sit back and think why in the world you need all those cards. Sure, stores offer rewards to their credit card holders, but having a credit card for every store you shop at is not always a good thing. The problem is the more cards you have the more chance you have to get yourself in some serious debt, and debt is never a good thing. If you get a discount for using a store credit card and don't pay your balance in full by your grace period you are not saving yourself any money. In fact most stores hope you will come in and use your discount to charge a bunch of money and then not pay it in full because then they are making money off you!
Fact is most people use credit cards because they want something and don't have the money to pay for it at the time. This is your first mistake. You should never buy stuff you don't have the money for. So if your sitting here thinking...gosh I do have several cards with balances what can I do?
These would be my suggestions to start trimming off credit card debt.
Now for the ones who do not have credit card debt. CONGRATULATIONS :) You are not the norm in today's world! If you have no credit card debt and can managed to use your credit cards responsibly then thier are ways to make your credit cards work for you. Our credit card has rewards points and we use this to our favor in several different ways. Since we pay off our card every month we use it to buy stuff and pay bills to rack up rewards points. Just by paying our cell phone bill through our credit card we can earn a $25.00 gift card in a 12 month time. We will cash in those points for gift cards around this time of year. They make for GREAT Christmas presents and they cost us nothing! You have to stick to your guns and make sure you are paying your balance off every month, if you don't it's a waste. If you have store cards and receive discounts go shop but....only when you need to and only spend what you know you can pay back off. There is nothing wrong with free money, if you make sure it is free!!!
At the end of the day credit cards are not evil. They don't jump out of your wallet and into the hand of a store clerk...you put them there! You're an adult and at some point have to be held responsible for your actions. If you can't be responsible with your credit cards just get rid of them. Make a point to start chipping away at that debt this year, and if you are one of the lucky people with no credit card debt keep up the good work :)
Now that 2011 is quickly coming to a close, it's the time of year where I start thinking about what financial goals I have in mind for the year ahead. So some of my upcoming blogs will be ways to help you start 2012 off right, and make financial goals and stick to them. Like I have said I am no finical expert, but I feel that as an average person I have the same money stresses as other ordinary people. These are things that I have done in the past that has got me to a point where I don't have to stress over money all the time. I am not rich, just an average middle class girl...just like most of you :) Hopefully you can find some things to get on track for 2012!
Today we will talk about the good and evil of that little piece of plastic in your wallet....CREDIT CARDS!!!
How many credit cards are sitting in your wallet right now? More than 3? If so you may want to sit back and think why in the world you need all those cards. Sure, stores offer rewards to their credit card holders, but having a credit card for every store you shop at is not always a good thing. The problem is the more cards you have the more chance you have to get yourself in some serious debt, and debt is never a good thing. If you get a discount for using a store credit card and don't pay your balance in full by your grace period you are not saving yourself any money. In fact most stores hope you will come in and use your discount to charge a bunch of money and then not pay it in full because then they are making money off you!
Fact is most people use credit cards because they want something and don't have the money to pay for it at the time. This is your first mistake. You should never buy stuff you don't have the money for. So if your sitting here thinking...gosh I do have several cards with balances what can I do?
These would be my suggestions to start trimming off credit card debt.
- Take all your store cards out of your wallet. Leave 1 major credit card just in case of an emergency. Put them up in a lock box or a hiding space in your house and do NOT touch them. If you know you will go back and grab them and use them just cut them up! You don't have to cancel your accounts, but until you get yourself in a better finical situation this will keep you from sneaking and using your card.
- Sit down with all of your most current credit card statements and write out the name of the card, the balance and the interest rate you are paying on the card.
- Where you go from here is up to you. When I eliminated my credit card debt I started with the card with the highest interest rate and started putting all my extra money to that card. If you are a person who needs to see fast results you can start with the card with the lowest balance. I would go with the highest interest rate because that way you are cutting down your debt and the interest you are accruing which will save you more money in the long run. Deciding to work on 1 card at a time will make you feel like you are accomplishing slashing your debt. I paid the minimum payment to my other cards and then put every penny I could to the card I was working on at the time.
- Once you get one card paid off, start on the next...and so on until you are credit card debt free.
Now for the ones who do not have credit card debt. CONGRATULATIONS :) You are not the norm in today's world! If you have no credit card debt and can managed to use your credit cards responsibly then thier are ways to make your credit cards work for you. Our credit card has rewards points and we use this to our favor in several different ways. Since we pay off our card every month we use it to buy stuff and pay bills to rack up rewards points. Just by paying our cell phone bill through our credit card we can earn a $25.00 gift card in a 12 month time. We will cash in those points for gift cards around this time of year. They make for GREAT Christmas presents and they cost us nothing! You have to stick to your guns and make sure you are paying your balance off every month, if you don't it's a waste. If you have store cards and receive discounts go shop but....only when you need to and only spend what you know you can pay back off. There is nothing wrong with free money, if you make sure it is free!!!
At the end of the day credit cards are not evil. They don't jump out of your wallet and into the hand of a store clerk...you put them there! You're an adult and at some point have to be held responsible for your actions. If you can't be responsible with your credit cards just get rid of them. Make a point to start chipping away at that debt this year, and if you are one of the lucky people with no credit card debt keep up the good work :)
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