It’s easy to decide for yourself to get out of debt. The difficult part is in executing your plans. And it is even more excruciating to go about your new-found frugal lifestyle when you are faced with the temptation of your credit card every time you flip open your wallet.
The good news is that when you have the will to push through your plans, there will always be a way. Here are some methods you can use to force yourself to spend less on credit. Pain
Reduce your credit limits
Cutting up all your credit cards can be a useful way of putting a stop to excessive spending. But for the sake of emergencies, keeping 1 or 2 is both practical and logical. In this case, call up the bank and request for a lower credit limit. Yes, you can actually do that. This will prevent you from charging more than you intend to on your cards. You are never going to go over your budget.
Replace your credit card with a debit card
It can be difficult to admit it. But one of the main reasons why people get into credit card debt is that they don’t track how much they spend until the end of the month. Your card will work 24 hours a day if it has to, until your credit limit is reached.
However, if you use a debit card, your whole approach to charging your card might totally change. This is because you start seeing your account balance dwindle lower and lower. This psychological effect can be enough to put a brake on your luxurious spending habits. You won’t be able to spend cash that you do not have in the account.
Don’t use credit on expendables
The money we spend on expendable items are the most difficult to track. And because purchases are often for smaller amounts, we tend to think that they are less significant. But when you take a look at the frequency of these transactions, you will see that these things really add up.
Expendable items are things that we can use up. Things like shampoo, frozen food, peanut butter, etc. It also include items that we consume like dinner, drinks, movie tickets. Stop paying for these items with credit. Only use credit for things that are one-off. For example, television sets, furniture, car seats, etc. Since these items are often more expensive as well, you can take advantage of of cash rebates available on the cards’ rewards programs.
Start keeping an eye on hidden and total costs of a purchase
The total amount of money you spend on something is often not as obvious than you imagine. The classic example of this is buying a house. First time home buyers often think that all they need to prepare is the cash for the down payment. They forget about the mortgage, legal fees, valuation fees, administrative charges, insurance premiums, etc. You need to do these costs analysis when you purchase something. You don’t want to go down that debt trap again.
Block yourself from bank sales officers
Marketers are putting up advertisements everywhere enticing people to sign up for credit cards. They are then support by sales staff making cold calls, or going on road shows everywhere to reinforce their message. Stop yourself from talking to these sales staff when they approach you. If you need to, change your phone number so that the sales office will never be able to spam you with their calls and SMS again. That is… until you unknowingly write down your phone number somewhere again.
Stop yourself from bringing your credit cards
If you are making a casual trip to the supermarket or running simple errands, avoid bring your credit cards with you. You did not have plans for them anyway. So why bring them along? Having convenient access to them just makes it easier for you to reach in for a quick swipe.