Monday, September 14, 2009

How to Break Credit Card Addiction

Credit card addiction is no laughing matter. Retail therapy is used jokingly in our society, yet there is a dark side to spending money. A compulsive shopper may have one or more reasons for their behavior.
A shopping addict cannot just stop cold turkey. The most obvious side effect of credit card addiction is the financial distress one causes themselves and their family, “but that is not the only negative effect of the addiction,” says April Benson, a compulsive shopping researcher.

Other effects of the shopping addiction include relationships with other people, family and friends. You can be affected professionally if you are shopping online at work or get yourself in such financial distress that it affects your credit rating. Shopping additions, including credit card addiction is a very real addiction and needs to be dealt with accordingly.





Credit card addiction is almost always coupled with poor money management. Often people will blame the credit card itself for their debt and problems.
You may be tempted to go cold turkey and cut up all of your plastic, but we live in a society where credit and debit cards are a necessity of life.
Tackling a credit card addiction today is not an easy task however, you can get control.

Instructions
  1. Step 1

    To begin with, limit yourself to two or three credit cards. Use one that is a low interest rate, preferably with your bank. You can also use a gas company credit card, if it gets you a better price on gas. Consider finding a credit card that offers some kind of point or mileage system so you can benefit from your monthly charges.

  2. Step 2

    Record every charge you make in a memo book or ledger. It is easy to just keep spending with a credit card. Without being able to check the internet, it is difficult to keep a running balance on your credit card. Use the internet statements to back yourself up and a memo pad to physically write down everything you are spending money on.

  3. Step 3

    Put a limit on your spending. Do not use the limits that the credit card companies have set for you. They will continue to increase your limits as time goes on, do not let them dictate how you will live your life. High credit card limits can also affect your credit rating. If the credit card company automatically raises your limits without your consent, politely ask them to lower the limit back down to what your spending limits you have set for yourself are.

  4. Step 4

    Do not spend more than 20% of your monthly budget on consumer debt. This is your monthly payments and includes car loans, credit card debt and other consumer debt loans. If you are paying more than 20% of your disposable income on monthly payments to consumer debt, you need to take steps to reduce or eliminate your debt.

  5. Step 5

    Pay with cash! Using credit cards for convenience or to earn rewards is fine, but your goal should be to pay them off at the end of the month or the beginning of the next month. Your goal should be to pay for what you can afford. Save for big purchases, save the credit card for emergencies if you don’t have an emergency savings account (which you should have).

  6. Step 6

    Don’t try to keep up with your neighbors! Know your own and your family’s goals and plan and budget for those goals. Don’t let your neighbors and friends decide what you are going to spend your money on.

http://www.ehow.com/how_5334227_break-credit-card-addiction.html - Demarco

2 comments:

  1. lots of tips here. good job. i think the site is fine.

    ReplyDelete
  2. This is a great (and very inspiring) article. I wanted to share a (free and non-profit) resource that can be a great help for problems with compulsive credit card use (and also any other problem involving compulsive patterns of being in debt)--

    The organization is Debtors Anonymous, its been a huge help to many people and it provides free support groups and very helpful literature for these problems. They are a worldwide organization: www.debtorsanonymous.org

    ReplyDelete

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