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Lowering Credit Card Debt Begins with Recording your Expenses |
By Donna Allison on July 9, 2010
.jpg.aspx?width=75&height=75) Lowering credit card debt can be as easy as buying a small notebook! This single inexpensive investment can be the key to a more predictable and peaceful financial future.
Start writing down each item you charge in this notebook. This way you can easily add up the cost of purchases. You can determine how much you are spending on a monthly basis, and there will not be that unpleasant surprise when the bill comes, and you have actually spent twice as much as you thought!
For the time being, you may want to limit your purchases to necessities, until you determine how much you want to budget for those luxury items. Everyone needs to have a little money to spend on themselves; the key is how much. Review your most recent credit card statement, and mark items as “necessity,” or “luxury.” Once you have an idea how much you spend monthly on necessities, determine an amount that you can feel satisfied with spending weekly, or monthly if you prefer, on yourself. If you compare prices between at least two different sources on each item, whether a necessity or a luxury, you will spend less. Consumer Reports magazine is an excellent source for finding good quality items, and will allow you to budget for the cost. You can also find good quality items on the websites of various companies; look at their “clearance,” or “on sale,” items. Just make sure it is a secure website (icon of padlock) before disclosing your credit card information.
If your credit card debt is quite high, use cash or debit cards to pay for items immediately. This will encourage you to take responsibility for paying as you go. Put yourself on a budget by limiting your weekly spending money. Use only one credit card. This, and using your trusty notebook for writing down all credit card purchases, will encourage you not to incur increasing debt. This is the key to lowering your credit card costs, and giving you an increased sense of security in managing your money.
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