Changing Your Relationship With Your Credit Card

If you want to make a simple mental shift to put an end to credit card debt accumulation, think about how you relate to your credit card. When you use a credit card you are borrowing money. For some reason most of us don’t see it that way. We treat our credit card similar to our debt card. The line of credit available for use on your credit card is not your money and it never was. That available balance is not an increased bank balance. The ease of swiping a credit card comes with a delayed realization that you have to pay the money back with interest.

So, what is with the credit card game and should you play it?

While many of us believe that swiping can lead to some extra perks, a very small percentage us of reap the benefits of the extra awards and frequent travel miles. If you are someone that uses their credit card and pays if off at the end of every week before the interest accumulates, congrats! Most of us don’t operate like this. Instead we,

• Swipe our credit card with the intention of paying it back in a timely manner, but usually don’t hit the mark

• Use a credit card as a financial place holder until our next paycheck comes in

• Swipe and forget that we used it altogether, until the bill comes in

• Have a vague sense of how much our balances are

• Don’t plan on how to use the perks

• Sign up for them to cover an expense that we don’t have the cash for

• Believe we need them to get by

The credit card companies are not making money on the super structured credit card user, but rather all of the users mentioned in the list above. These are the people that allow balances to stay on their credit cards and get hit with the interest on a regular basis. This is the majority of credit card users.

Know Thy Self

In the end, you have to know yourself and your relationship with your credit cards. If you can relate to any of the statements above, you should not use credit cards for regular expenses and daily purchases. For the people above, using a credit card for purchases will continue to grow your mountain of debt. Be completely honest with yourself. Do you swipe without a plan?