09 January 2011

A View of Credit....

Have you ever watched "Til Debt Do Us Part" on CNBC?

My husband and I started watching this show last year. Growing up I didn't learn good money habits, but I knew I needed to do my best at saving and not spending money. However, from watching this show I've started to get more interested in finances. This biggest thing I've learned is to write down my expenses every time I spend something. This has been the biggest eye opener! You really don't realize how much you spend until you write it down. And it's important to write it down because you start to understand how much you spend, where you're spending it, and what you're spending it on.

But one has to think...how do I spend so much money? For me, which I bet most people will say the same thing, is credit cards. This has been a challenge for me this past year. Though I've been really proud of myself this past year too; cause I was able to pay off two of my credit cards. I have to say that it's a big deal to tell this out loud. It's hard to admit you have debt to others, but the thing is to understand that everyone has some kind of debt. They just don't tell you.

Though today, I found a great article -"9 Reasons to Say "No" to Credit" on credit debt on Yahoo Finance. It talks about ideas to give yourself to get out of credit debt. I've actually used some of these 9 reasons to help me. Here are the few I've already used to help me get more out of credit debt:
  1. Financing your purchases doesn't teach self control. 
    • It just gives you a way to buy the things you want as you tell yourself - "I can pay this off."
  2. Financing your purchases means you aren't sticking to your budget.
    • Usually on a budget, you're counting in the expenses you already have, not the new one's your making with your credit cards. So, don't make new ones on credit.
  3. Credit card interest rates are expensive.
    • Yes, they are! And they make it even harder to pay off your cards too.
  4. Credit card interest rates increase when you can't pay off your balance in full.
    • It's really important to pay your cards off. Interest rates will just keep getting higher on your cards if you don't. Also, it means that you will have to keep paying high interest payments too.
  5. Financing purchases can lead to higher spending. 
    • Either spending on more things or more expensive things that you probably don't need. 
  6. Avoiding financing can bring peace of mind.
    • The author sums it up perfectly! "If you don't owe anyone money, you won't have to worry about late fees, interest, annual fees or over-the-limit fees."

So for all of you out there with a New Year's resolution of saving more money and not spending so much, take this time to think about how you can tackle your credit card finances this year better. You'll feel much better about thing. Believe it does work! Enjoy!

Image from profin; Show: Til Debt Do Us Part; Finance Article: 9 Reasons to Say "No" to Credit

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