by Tricia
I remembered what I wanted to say earlier today 🙂
I will probably get a lot of slack for coming clean on this one, since I know there are many fans of a particular get-out-of-debt person out there. He advocates not using credit cards at all. I happen to disagree with that with our situation.
We still use one of our credit cards (with the lowest limit) for the following purchases:
1.) Online. There is NO WAY I am giving my debit card number out online. I like the protection that credit cards offer with unauthorized purchases. I can tell you for a fact that there are more people that have access to your numbers when you purchase something online than you think.
2.) Recurring Purchases (things like hosting fees and subscriptions). Again, there’s no way I am giving out our debit card number. Plus, if I happen to forget when a yearly subscription with be withdrawn, it can be paid on my credit card without worrying that a check will bounce in my checking account (I run it pretty darn low to pay off debt).
I bite my tongue on this blog a lot, because I do get upset at my cards and want to call them evil. But really, they aren’t. In the end, I was the one who abused them. They did not force me to buy things with them to where I couldn’t pay the balance in full every month. I did that all by myself.
That’s just my viewpoint, and everyone is entitiled to theirs. I’ve said it once, and I’ll say it again, when it comes to reducing your debt you have to do what is right for you and your situation. I just thought it was fair to let everyone know that we still technically use our credit cards.
The main thing is that we are now using them like they should be used – we pay the balance in full every month 😉
I just posted a few hours ago saying why using credit cards can be good – if you are able to use them correctly. Have a look at my post for details:
http://enoughwealth.blogspot.com/2006/10/frugal-living-credit-cards.html
If you are paying the full balance each month, I fully agree that it’s ok to use credit cards. When one is paying the full balance, a credit card serves as a convenience not a crutch.
I agree and do the same!
I think the saying goes – Great Minds Think Alike! I did a similar post recently.
To me Credit Cards are Tool. I am the monster that must be controlled!
Some things are just done better with a credit card, but I’m trying to use it only for what has to be on it, then I pay that amount immediately using online bill paying so I don’t incur unsecured debt. Complicated, but I don’t like to give out my debit card number, either.
Hi, Kudos for you for taking control of your debt situation and having the courage to share it with the world via your blog!
Other visitors have given some great comments and I wanted to contribute my own thoughts:
1. It’s almost unavoidable in today’s society to have to use credit cards at some point.
2. For those trying to get out of debt, getting rid of all of your cards entirely can actually hurt your credit rating in the long-run. I’ve seen people eliminate all debt and then years down the road, they need credit for some reason and have no established credit history.
3. The idea of immediately paying your credit card charges when they are incurred (rather than waiting for the bill to come in) is an excellent idea. If you don’t have the money in the bank TODAY to pay for it, then don’t charge it! The problem with most people and overspending on credit cards is that they are expecting to use tomorrow’s dollars to spend for today’s purchases… then they either spend more than they anticipate or money doesn’t materialize etc etc and they find themselves carrying debt.
4. Several years ago while I was working at clearing off debt myself, I worked through one card at a time going from the highest interest rate downwards. I kept the highest interest rate card as my ‘working’ card and followed the strategy of paying off all new charges immediately. Once I cleared another card, I’d cancel the other and use the lower rate one. This way I’d be paying zero interest on these new purchases.
Continued success to you in reaching your goal!
Thank you everyone for commenting. I do think credit cards can be used for good, it’s just easy to mis-use them. We’ve paid a lot of money to learn our lesson, but I think we’ve learned it. If we can’t turn around and pay cash for something that we’ve put on the card, then we shouldn’t be buying it.
This is true. If you can’t pay for it, don’t use it. BUT (OH NO) my daughter needed a new pair of glasses and we do not have optical insurance — $500.00 (at Wal – Mart even). Then a couple of weeks later, the orthodontist and dentist $186.00 because we do not have dental insurance. We had to put all of this on credit cards. $100.00 for tires on my car and plates are also due this month. How do I make any payments on my credit card debt at all let alone pay off this new debt right away. I feel so overwhelmed and defeated.
KIM – I understand what you are saying. That’s what it was like for us before we started earning more. If you are already trying to reduce your expenses, but still are having trouble with these unexpected expenses, the only thing to do now may be to increase your income and bring in some extra money to pay off the debt.
I know it’s hard, but try not to let yourself feel overwhelmed and defeated for too long. Yes, you have had a major set-back with the things you needed to charge. But don’t let it stop you from still trying. I used to feel defeated and like there was no way we were going to get anywhere with our debt (this was before I started blogging). What I would sometimes do, is just get an “Oh well” attitude and start charging things, thinking there’s nothing that I can do about it anyway. Thats a dangerous way to feel.