We all know the difference between debit cards and credit cards (well at least I hope so). Trust me, I’ve met some people that don’t…
A debit card is money you have readily available in a checking account with a bank. A credit card gives you the ability to make purchases with money that is borrowed from a bank. The majority of these banks that offer credit cards are going to charge you interest if you don’t pay your balance off that month. There are many credit cards that offer 0% interest for the first year, but that’s another topic to talk about. I want to talk about how to stop using credit cards if you’re someone who isn’t paying your balance off full each month.
According to LexingtonLaw, “43% of Americans carry over a credit card balance each month.”
That’s almost 50% of Americans! Why is that? Well, I can tell you that 99% of the time it’s because you don’t have the money. I always heard growing up, “Don’t spend the money if you don’t have it readily available.” This article isn’t about how credit cards are bad, it’s about how to stop using credit cards if you’ve been continuously carrying over a balance for months on end. I think credit cards can be a very good thing if you use them correctly. Such as paying off your balance in full each month, and using reward points programs with credit cards to your full advantage.
How can you stop using credit cards?
Use Cash
Yes, you can actually use physical cash. Even though we’ve come along way with technology and cards, people still like using physical cash today. Most people are going to use their debit cards. Use your debit card on purchases such as dining out, groceries, etc. Know the amount of money you have available in your checking account. If your someone who has a large balance on your credit card, using your debit card for everyday purchases will definitely help.
Get Rid of Credit Cards
I met a person once who told me they have twelve credit cards and had balances on at least six of them. I was definitely shocked, to say the least. You don’t need twelve credit cards. I have three credit cards. In my personal opinion I don’t think you should have more than two to three credit cards. Get rid of some credit cards if you have too many. Leave some or all of them at home when you go out and are tempted to use them.
Create a Budget
Know what your monthly income and expenses. Track your spending. There a ton of apps out there and resources to use to help you track expenses. MINT is a free budgeting app you can use and link your checking account to. I have used it and it works well. I personally use Excel, but that works for me. After all your monthly expenses are paid for, know what amount is leftover and where you’re allocating it.
Create an Emergency Fund
Have some type of emergency fund and store it in a high yield savings account. Typically, you should have 6–9 months’ worth of expenses in an emergency fund. Having an emergency fund will give you that safety net, and sense of security if a major expense were to come up. And, especially give you that safety when trying to eliminate carrying over a credit card balance or being able to pay off your credit balance in full each month.
Overall, there are many ways to eliminate using credit cards. And, really what it comes down to is discipline and self-control.
You’re the one that has control over whether to use your credit card or not. Swiping takes seconds, and that’s why many of us fall victim to using credit cards even when we don’t have the money.
This article is for informational purposes only, it should not be considered Financial or Legal Advice. Not all information will be accurate. Consult a financial professional before making any major financial decisions.