When getting out of debt, one of the first things we had to do was break the credit card habit. For years, we used credit cards for convenience – and then we woke up one day and realized we were in debt and paying interest. Here’s how we changed our behaviors and made the break –
We Balanced Our Checkbook –
This set us up for success. This is a simple, but necessary step. We needed to know exactly how much money we had, to the penny, for spending and debt reduction. It only takes a few minutes to go online, review recent transactions and balance the checkbook.
We Lived On A Budget –
Instead of spending without a plan, we sit down together and create a monthly budget. This keeps us in touch with our finances, and we aren’t simply swiping a credit card when we want something.
We Kept Our Credit Cards –
We didn’t cut up our credit cards or freeze them in ice water. Instead, we just decided not to use them for everyday purchases. They are in our wallets, for emergencies.
We Used A Debt Card –
For convenience purchases, we use a debit card.
We Learned To Manage Our Cash –
We used – and use – the popular envelope system to manage our cash. We limit our spending to the amounts in our envelopes. This way, we are not tempted to overspend – and thus use our credit cards.
I Stopped Thinking “I Deserve This” –
In the past, I could justify almost any purchase by saying to myself, “I deserve this…” It didn’t how much it cost, or how little we had, I could somehow rationalize the use credit. In fact, I can distinctly remember thinking, “What’s a little interest? I work hard, I want it, so I’m going to get it.”
Now, instead of thinking, “I deserve this.” I think, “Can I truly afford this?”
There is nothing wrong, fundamentally, with credit card use. The problem is – use can turn into abuse very quickly.