How To Keep Credit Card Spening Under Control

How To Keep Credit Card Spening Under Control

It’s very nearly the most depressing day of the year (said to be the 3rd Monday in January).  There’s a long stretch to go until payday, the weather is cold, we’ve all overindulged during the festive period and we all have no money left to see us through to the month. so some of us are replying quite heaving on our credit card.  It’s this time of year that it’s all too easy to rely on our credit cards to see us through.  I’ve put together this post to help you prevent that.  I hope it helps you.

broke

How To Tell If You’re Overspending On Credit Cards

How much have you spent on your credit cards lately?  Credit cards can be very useful and they are also a great way to build your credit score.  However, it is very easy to overspend on them because it can often feel like it’s not real money as it doesn’t come out of your current account.

The first thing that you should do is check the balance of your credit card.  If the balance is more than what you can afford to pay off, then there is a high chance that you are overspending on your credit card.  You should also take note of how much interest you are paying each month and compare it with how much interest is being charged by other people who have the same type of account.  If the interest rate for your account is higher, then it’s possible that you are overspending.  I’d recommend seeking advice before you get yourself into lots of debt.

How Debt Consolidation Works And How To Use It

You could also consider debt consolidation to make your repayments easier.  Debt consolidation is a process of combining all your debts into one large loan, which you then repay over time.  This can be beneficial for people who are struggling to make payments on their debts every month.  However, it is not for everyone.

The benefits of debt consolidation are that it simplifies your monthly payments and lowers the total interest you will pay over time.  You also have more flexibility in terms of repayment plans, which can be helpful if you don’t have the cash flow to make monthly payments on all your debts.

The drawbacks of debt consolidation are that you will likely end up paying more in interest over the long term because you will be borrowing at a higher rate than what your original loans were at.  You also might need a good credit score in order to qualify.  You can find more information about this here.

credit card spending

How To Identify Your Spending Habits

The first step is to write down what you spend money on.  This includes things like groceries, fuel for your car, coffee, clothes, etc.  It can be helpful to keep a running total of what you spend money on each day or week.  Write down the date and the amount that you spent in a row next to each item.

Next, calculate how much of your income is going towards these things.  For example, if you make £2,000 per month and spend £1000 per month on groceries then 50% of your income is going towards food.  Once you have this information it will be easier for you to see where your money is going and find ways to cut back on expenses that are less important.

How To Create A Budget That Works For You

A budget is a plan that outlines how to allocate your money. In order to create a budget, you need to make sure you have a goal in mind for each category.

Here are some questions you may want to ask yourself when creating a budget:

  • What is my goal?
  • How much money do I have available?
  • Do I want to save or spend more?
  • What can I cut back on?

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