Using self control with your credit cards

We all know that economic times are bad, many people are struggling and more and more people are spiralling into debt. For this reason it is even more important to curb our uncontrollable credit card spending and it all comes down to how well we can implement some self control.

Utilising some basic principles of self control, will allow you to manage your money more effectively and also find new ways to purchase things without using the infamous credit card.

We encourage you to read this article, think about how you control your credit card spending and submit a comment about the ways in which others could potentially learn from your tips in order to reduce their credit card usage/spending.

Change your mentality

We live in an age of wanting (not needing) instant gratification which is how so many Australians (especially younger Australians) have ended up in credit debt trouble. Debt can cause tremendous mental and physical stress and strain for both individuals and families so it is important if you are to have a healthy and happy life to change your mentality to spending. It might seem simple in concept yet many people do not actually carry through with their decisions to use self control. You cannot control your spending if you do not change your mentality in the first place. If you cannot have the foresight to realise you are dwindling down a black hole you won’t be able to save your money!

Write a budget

It can take time to write a proper budget but it is worthwhile to do so you can understand what you actually need to spend your money on in order to prevent you to spend it on frivolous items. Things such as food, travel expenses, phone bills etc are important to consider and be realistic with how much these things cost. Also try and include once off items such as car insurance. If you can include this in your budget you can save for it rather than be hit with a big sum which you don’t have any money to pay for (and would undoubtedly just chuck on the card). Also include some money for spending on entertainment or social events-you still need to enjoy yourself.

Help with writing a budget:

1. How to setup a budget
2. Excel Budget Spreadsheet
3. Budgeting to get out of debt

Leave your card at home to curb your impulse buying

If you are going out shopping it’s a good idea to try and leave your credit card at home to avoid using it on items you might not need. This will help curb your impulse buying and allow you time to think about whether or not you should really be spending $100 on that jumper that you don’t really have a use for. It will also encourage you to shop around and compare prices. There is nothing worse than purchasing an item and then finding the same one cheaper at another location or finding a better version that you would have preferred. If you cannot be trusted with this then give your card to someone to hang on to.

Utilise Lay-by

Most stores also have a lay by system where you can pay off your desired item over a period of usually about 8 weeks. This will allow you to budget for the item so you can use just your savings or weekly pay to for it not the credit card. However keep in mind to not just to substitute this system to buy anything and everything. Still ask yourself whether you really need it and whether it is still worth spending your money on.

Research, research, research

There are often some circumstances where you may need quick access to money but do not have the cash upfront such as car repairs. It is ok to have one credit card for such purposes but there are few important things to consider. Firstly make sure you research every possible credit card, compare rates, annual fees, different interest rates for cash purchases etc. Try and get a locked in low interest rate-often we get caught by low rates without reading the fine print that after 6months it actually can sky rocket to up to double the rate. And if you do use the card for such things try and pay back more than the monthly minimum payments to avoid only paying off the interest payments and not actually getting anywhere with your debt.

Get to it and make a plan

Do not worry if you are in debt and struggling to get out of it but be PROACTIVE. Sit down and work out a plan either by yourself or with the help of someone else. We can all make bad decisions at one time or another but the key is to realise that it was a bad decision and try and find ways to not make it again. Everyone is different in how they respond to different methods so work out how much debt you are really in and then sit down and ask: what can I do to get out of debt?

Share your tips on reducing credit spend

What is your top tip for self control with a credit card?

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