I just paid another $500 off my credit card. I’ve been sitting on this money for a couple of weeks, the only rational I have is that I thought I might need it.
Another strategy I’m considering is transferring the bulk of my pay as soon as I get it to my credit card and then using the credit card for all my purchases. I’ll still need to keep hold of a little cash but I could probably put $700 off my credit cards each fortnight.
The catch with this theory is that I would need to have a great amount of self control not to overspend. When I use cash I can see my wallet getting thinner, when I use the credit card it actually seems to get fatter with all the little docket reciepts I accumulate.
At the moment I have about $120 in my wallet and $378 in my everyday account, that’s got to last me the next 10 days until I get paid again. Now $500 for ten days may seem like an excessive amount of discretionary spending money, but my daily habits of eating and smoking (bad, I know!) run me to about $25 a day. Plus there will enveriably be other expenses, Wining, Dining, etc.
I also spent $130 on clothes yesterday, that went straight on the credit card, and I also spent $235 on a back up drive for my computer, which also went on the credit card, but fortunately because I still have a computer based business (even if it’s technically not making a profit right now) I can write the purchase (and the credit card interest) off against my tax.
I really need to focus on increasing my income so I can lead the lifestyle I want and reduce the credit card debt at the same time.
UPDATE: I found $270 in my business account that I had forgot about, which was immediatly transferred to the credit cards I use for business expenses
July 31st, 2005 at 1:18 pm
Let me get this straight, you paid off your credit card $500 and then you
purchased approx $500 worth of stuff. Hmmm…
Are you getting any points or credit for using your credit cards?
If not, why not just use cash to pay for stuff?
Financial Maturity Blog
July 31st, 2005 at 8:07 pm
I do get points for my credit card use, but it’s not a motivating factor.
I did spend around $350. so I wasnt making any real gain, especially when you take into account the interest I pay.
The real reason I do it is that I get charged for more than five transactions a month, so I try to limit the amount of transactions I make on my savings (and I use that word liberally) account. The banks are making enough out of me.
August 3rd, 2005 at 12:29 pm
I would avoid charging anything to your credit cards if your goal is to pay them off.
If it were me, I would make out a budget so that I knew how much I could afford to pay
each month. Don’t make it an amount that stresses you or puts you in a bind. It may feel like
it is going to take longer to pay off, but in the long-run it is probably the best solution.
Good luck!
JLP
August 6th, 2005 at 9:38 am
JLP
In this day and age it’s difficult to avoid paying for things on credit card, it’s just so damn convenient, what I think I need to do is get over the “I need it now” urge.
And though I’ve tried in the past, budgets don’t work for me, I’m normally fairly sensible most of the time, but every now and then I get a little impulsive, and damn the expense.
August 11th, 2005 at 2:11 pm
Here’s a suggestion:
Get a bank card that is tied to your bank account and get rid of ALL your other cards. You’ll still have the convenience of a credit card but each purchase is taken directly out of your bank account.
What I’m gathering from your posts is that you want to get out of debt but you don’t want to that badly. I’m afraid until you really figure out what you want, you will keep having problems.
August 26th, 2005 at 6:57 am
I agree with JLP.
If you’re trying to pay off your debts, stop using your credit cards.
You may have a little convenience withdrawal.
Thinking in a “cash only” takes a bit of time, but it will stop the credit card convenience addiction.
Financial Maturity Blog