It’s one thing to add a credit card to your wallet or purse. It’s another thing entirely to use your credit card in a responsible manner.
There’s no denying the fact that a credit card is a useful financial tool that can bring many benefits to your life.
Conversely, if you don’t watch what you’re doing, you could soon find yourself swimming in credit card debt and wondering what went wrong.
So, with all this in mind, you should have a clear idea of the steps you can take to avoid running up credit card debt. Here are some ideas to consider:
1. Track Your Spending
This is where many people get into trouble. You know your credit card limit and you probably know when you’re getting close to reaching it. But until then, you fall into the trap of believing that you can spend, spend, and spend some more.
Don’t let that happen to you. Track every dollar you put on your credit card, just as you would if you were paying with a debit card.
This is easy to do, since mostly every credit card provides access to online account management.
2. Set Limits on What You’ll Buy With Your Credit Card
Rather than put every purchase on your credit card, set limits as to what you will and won’t buy with it.
For instance, maybe you buy groceries and gas with your credit card. But when it comes to other expenses, such as birthday gifts and entertainment, you stick to a cash system.
When you set personal limits as to how you’ll use your credit card, it’s easier to avoid overspending.
3. Leave it at Home
You can’t use your credit card when you don’t have it with you. So, when you head out to the store, leave your credit card at home.
When you get into this habit, if necessary, it teaches you that you don’t need your credit card to survive.
Tip: this doesn’t work when shopping online, so you may need to keep your credit card in a safe place and use some will power to avoid overspending.
There is only one guaranteed way to avoid running up credit card debt: don’t apply for a credit card in the first place.
Of course, this is drastic, because using a credit card can bring so many benefits to your financial life.
Instead, do your best to use the tips above to your advantage.
Have you ever found yourself in entirely too much credit card debt? What do you attribute it to? How were you able to get back to square one?