March 30th, 2015 by Jason M. Kaplan, Esq.
How to Never Carry Credit Card Debt Again
A good credit score is a necessity for getting the best deal when you go to buy an automobile or a home. One way to acquire and maintain a good credit score is by using credit cards, but never carrying credit card debt. According to a study published by CNN, an average American household, with a single credit card or more, carried a debt of almost $15,950 in 2012 alone. Here’s a list of things you can do to ensure you stay away from credit card debt as much as possible.
- Save for emergencies, holidays and vacations.
Put aside money every month so when these events come up, you don’t have to accumulate a large debt that you can’t pay off before the end of the month.
- Make a list before going shopping.
If it isn’t on the list, it doesn’t go into the shopping cart. If you see something you just can’t live without, decide what item on your list you can live without. Replace items on your list if you must, but don’t add to it.
- Leave credit cards at home when you go out.
Save yourself from impulse buying by only taking enough cash with you to cover what you plan to spend. Most of the time, if you have to find an ATM to get more cash, you’ll either decide it isn’t worth the effort or you really don’t need that extra item after all.
According to a study published by Creditcard.com, 3 in 4 Americans are victim of impulse buying. The reason? Well, the findings of the study state “Those purchases came because we were excited (49 percent), bored (30 percent), sad (22 percent), angry (9 percent) or intoxicated (9 percent).” So, next time you go shopping, make sure you’re carrying a list for yourself!
- Don’t overspend just to collect “rewards”.
Some credit cards offer great “rewards” programs, but they aren’t so great if you overspend just to reap their benefits. If you can’t pay off the card before the end of the month, you’ll end up paying a lot more than you saved.
- Live within your means.
Make sure your lifestyle is compatible with your income. If you have to use credit cards to maintain your lifestyle, track your expenditures and see where you can cut back.
- Make payments every week.
Make small payments every week to ensure your balance stays under control. Additionally, your bank balance is reduced every week so you don’t trick yourself into thinking you have more money than you really do.
- Make accessing your credit card more difficult.
Give your card to someone you can trust and who isn’t a pushover. If you need to use the card, you will have to justify the purchase to that person before making it.
- Check your credit score on a regular basis.
Keeping tabs on your credit score allows you to see how well you’re doing and if you need to make changes to your spending, as well as making sure there are no errors or attempts at identity theft.
In today’s world, getting a credit card is pretty easy. Mismanaging it is even easier. Get into the habits listed above and make sure you don’t fall into the credit trap.
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