While many can’t keep their credit cards at a zero balance, some people can. I’m one of those people who pay their monthly credit card balance in full (but not after experiencing getting neck-deep in credit card debt first which was one of the reasons why I got to appear on a local business and finance TV show last year!). More than learning my lesson the hard way, I think what made me get my acts together was getting drained (financially and emotionally) by this vicious cycle which only I could break. The thought of being credit card debt-free (and the joy that comes with it!) was just a bonus.
Maintaining a zero balance on credit cards is doable. Here are some practices I employ to make sure the hubby and I get to pay our credit card debts in full every month:
1. Keeping track of our credit card spending. I have this note in my phone that’s dedicated to my purchases using my credit card and other finance-related things. This way, I’d know when a purchase gets included in the current billing cycle or the next. I normally schedule our purchases a day or two after the cut-off date so the payment period is longer. As for the hubby’s credit card, I take care of tracking his purchases and paying for it, too (using his money, of course).
2. Paying for our credit card purchases on the spot. You might ask, how is this possible? It’s like this. Whenever I buy something using my credit card, I make sure I have money to pay for it. I immediately put the money in this “money purse” (where I put all money allotted for credit card payments and other stuff) I keep someplace safe. For example, I went to the supermarket and bought groceries using my credit card. Once I get home, I pay for it using cash from my own wallet and put the money in that “money purse.” If my cash isn’t enough, I record this expense in my phone (the same note I was talking about in no. 1) and allot money from my payroll ATM to pay for it by reflecting it in the MS Excel file I maintain for my finances. )I devised this file back in 2007 and I’ve been using it ever since to balance the money in my payroll ATM.)
Here’s a simplified version of that file so you’ll have an idea:
3. Doing nos. 1 and 2 consistently. Consistency is definitely the key here. You master something through constant practice. You form a habit by doing things repeatedly until it becomes second nature to you. By making sure I keep track of our credit card spending and pay for our credit card purchases on the spot, the hubby and I get to maintain a zero balance on our credit cards. We still avail of items via installment (those under the “real” 0% interest promo only) but we see to it we apply the same approach to them.
One great advantage of having a zero balance on your credit card is you get to have your annual membership fee waived by the bank/credit card company without a fuss. I normally make a request for this to the customer service representative via phone in a nice way and my request gets granted all the time. Annual fees these days range from PHP1,500 to 4,500 depending on the type of your card and its credit limit. Medyo mabigat din sa bulsa, diba? Marami na kaya akong mabibili sa ganung halaga!
4. Praying for a steady supply of discipline and emotional strength to fight shopping temptations. Shopping temptations abound and it takes a great deal of discipline and emotional strength to overcome them. We are just humans, after all. We get tempted with shopping sales, discounts, promos, and all sorts of marketing gimmicks trying to rob us of our hard-earned money all the time. Idagdag mo pa dyan ang social media na para bang pinaparamdam sayo na dapat may ganito ka, may ganyan ka at andito ka, andyan ka. You get the drift. I believe it’s something that needs divine intervention for better management lest you get crazy and accumulate unwanted debts for trying to keep up with the Joneses. I’ve been there and known the feeling. But now that I’m out of that vicious cycle, I can sleep peacefully at night knowing that I’m totally in control of my credit card use.
If you have more tips to share so we could all keep our credit cards at a zero balance, please comment away so we could learn from each other. Thanks in advance! 🙂
May you choose happiness always,