by slim'n'none

Created on: February 15, 2009   Last Updated: March 20, 2009

Credit cards make life easier. No more waiting to save up for whatever it is that has taken your fancy today. No more adjusting the budget to pay for things. Just swipe the plastic and its covered. And all for a remarkably low interest rate and easy to make monthly payments. Well, that's how it seems. In reality a credit card is a license for debt.

That's what your line of credit is. Based on a number of factors I won't get into here, the company giving you the card is offering you a a line of credit. That is, they agree to pay for your purchases up front, in return for you paying them back, along with an interest rate that varies with the company, your financial status, and the amount of time they carry your debt.

Credit cards mean that you don't have to have the money on hand to pay for something. This means it is easy to forget the long term ramifications of the purchases you make with one. It also makes expensive items look cheaper. Because you have time to pay for them. It doesn't work that way sadly. Having experienced what credit card impulse spending is and what the results are, I have a few tips for how to stop credit card impulse spending.

1. Stick within the budget: If you set yourself a budget, and track it, even the purchases you make with the card will be compensated for. That doesn't mean there won't be surprise purchases, but when you've budgeted in an amount you're willing to pay monthly on your debt, you're more likely to be thinking about that debt, and less likely to increase it. Also, a budget allows you money for your impulses, and therefore you don't need to use the credit card. I recommend having a budget whether you feel you need one or not. because it will force you to discipline your spending, and to develop savings plans for larger items that you want.

2. Freeze your assets: One very simple technique is to cut the top off of a milk jug, fill it with water, drop the card in, and stick the jug in the freezer. This means that any time you want to use the card, you have to wait for it to thaw out. This will definitely curtail impulse spending as you have time to think about the purchase. You're more likely to decide not to buy those $150 shoes if you have to wait an hour and a half for the card to thaw out.

3. Pay it off monthly: This is a definite way to limit your impulse buys. force yourself to pay off whatever you have put on the card at the end of each month. This will save you money long term, as the card is unable to charge you interest on the items you purchase. It also forces you to stay within your means as you have to pay it off at the end of each month. In conjunction with a budget this is an excellent technique.

4. Get rid of the card: This is a surefire way to stop impulse credit spending. Cut up the card. Toss it out. You can't use it if you don't have it. And if you have outstanding debt on the card, you can pay it down and get it under control.

Impulse credit card spending is dangerous. Hopefully the above ideas prove helpful. If not, at least they are starting points that may spark ideas of your own. Good luck, and don't spend too much.

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