Save Money Series: Get Rid of Your Credit Card Debts
When I got regularized from my first job, the first thing I did was to apply for a credit card. At that time, I was a lot sillier than I was now (hahaha…sure), and I felt that having a credit card represents my being a young professional. Naks! I know, I know…babaw! Hihihi!
As I rose from the ranks, my initial BPI Mastercard was joined by Citibank Visa, and eventually by BPI WorldPerks Mastercard. While I haven’t maxed them all out, I already saw red lights ahead. At one point, I felt like I was keeping my job to pay off my cards; oh, such a horrible position to be in! And so, I start my Save Money Series with the perennial problem of credit card debts. I listed below some ideas, both serious and bizarre, to help you get out of the rut. Oh, I finally got out of the vicious cycle…but it took me quite a long time. I hope the list below will help you handle your credit line better and get you out of the rut in record time.
1. Stop Swiping. Somebody said that when you find yourself deep in trouble, the first thing to do is to stop digging. Now, isn’t that simple? Stop using your card. Now.
2. Budget. Oh ok, if you can’t do #1, let’s just do a little math. Commit to a reasonable monthly budget for self-pampering (e.g shopping, dining out, spa, etc.) and stick by it. You shouldn’t charge more than your committed amount. And you have got to pay it up asap so you won’t carry it over to your next billing period and incur finance charges.
3. Consolidate. If you have managed to spread out your debts in several credit cards, it will be more manageable and financially reasonable to consolidate all your debts in one credit facility. In simple terms, get a bank loan and pay off all your credit cards in one sweeping motion. Remember that the interest rate of a bank loan is much smaller than the compounded interests of your credit cards.
4. Refuse. Just when you are feeling so elated because you have finally settled your credit card debts, the bank will ring you up and offer to increase your credit limit! And gosh, I used to fall for it all the time! Silly, silly me! Finally, I learned how to say “no thanks” at the age of 27. Learn it much younger.
5. Go for Desperate Measures. Now this is my favorite! I know people who actually did this at one point in their lives…and they say that it worked for them. I think it will work for you too. Here goes:
Desperate Measure #1 : Tape a picture of your goal on your credit card. This way, every time you pull your card out, you will be reminded that you are saving for something. I have a swipe-happy friend who taped a picture of wedding rings on his credit card so he will always be reminded that he is saving for his wedding and should not be doing his usual swiping. See his credit card below:
Desperate Measure #2: Tape a message over your cards. If you’re afraid to leave home your credit cards and be absolutely helpless during an emergency, you may want to write a message for yourself and tape it over them. It is quite scandalous, but all the better, because you would want to close your wallet in an instant. Hihihi! Just look at the picture below:
Desperate Measure #3: Wrap it with tape. If you can’t find the guts to cut your cards to pieces for fear of an emergency (here we go again…), you might want to wrap it with scotch tape. This way, you still have it in your wallet, but you will not be tempted to use it because you have to go through the hassle of taking off the tape. Not to mention that you will not want to “unwrap” it in public and will probably have to go to the nearest comfort room cubicle. Such hassle! See my hubby’s card below:
So there! That was fun! I hope you’ve picked up some ideas. Feel free to share other tips on how to get out of credit card debt. I, for one, can always use new techniques to discipline myself. Hihihi!
Comment from michael
Time: April 2, 2008, 10:54 pm
I can attest to desperate measure #3. As seen on the picture, my card got all taped-up by you-know-who and when I was about to use it this afternoon, I hestitated just because it was such a hassle unwrapping it. I just ended up looking for a nearby ATM to get some cash quickly. :))