One of the most important parts of learning how to use credit is learning how to use it responsibly. A new credit card does should not mean out-of-control spending – as a matter of fact, people will quickly learn that they can spend more if they remain in control than if they splurge.
For anyone who is trying to control their impulse buying on those purchases that seem to sneak in under the radar, here are a few of the top ways to stop out-of-control spending.
Go into the grocery store with a list.
Shoppers who attend grocery stores and other ongoing shopping expenditures with a list have much better luck in sticking to a budget than people who walk into a store unsure of what they actually want to purchase. Keeping a list tends to focus the mind on those items; as such, the buyer will literally not see those impulse items that are placed in strategic locations around the store in order to increase the chances of a purchase.
Clip coupons out of the Sunday paper.
Although there are many other ways to get news more quickly than the daily newspaper, there is no better place to get local coupons. The Internet is great for chain stores; however, for buyers who are looking to get discounts on things such as groceries and local warehouse staples, the Sunday paper is still the best place to look. As a matter of fact, the papers have begun to include more coupons in their Sunday editions simply because they recognize that this is the reason that they are able to stay in business. Clip those coupons before going to the store in order to save even more money on each trip.
Buy staples in bulk.
If you can make your purchases of groceries and things like underwear and T-shirts in bulk, then you can save more money for the luxuries that make your lifestyle great. Getting a warehouse membership is usually one of the best investments that an individual can make in this type of a lifestyle. Warehouse memberships allow people to make these stable purchases without having to spend a great deal of money at once. The staples will also last much longer, saving people money in the long run as well.
Detail uses for your credit cards.
For people with more than one credit card, a detailed plan for each of those financial devices is a great way to stop out-of-control spending. For instance, many individuals will have one credit card for emergencies only. Yet another credit card will be for gas and groceries. Another credit card will be for impulse purchases once a month. Credit cards that are meant for impulse purchases are usually paid back by the end of the month so that they do not carry a balance. This leads directly to the next tip:
Try not to carry a balance from month to month unless you absolutely have to.
Much of the burden of financial debt comes from interest payments and late fees rather than from principal payments. If it is at all possible, do not carry a month-to-month balance on impulse credit cards. Ideally, the only payments that should have interest-bearing accounts are long-term payments on large assets such as cars and houses.
More Serious Issues
For individuals who have dug themselves into a more serious financial hole, there are many steps that can be taken in order to bring back financial balance. Below are just a few of the ways in which an individual can help him or herself get back on the right financial track.
Debt management is the first step in obtaining professional financial assistance with a budget. This is usually the first service that should be considered before any other type of professional financial help.
Debt management is not as invasive as other forms of credit management. The extent of the professional help will be for the financial professional to give you advice on a schedule and check in with you routinely. However, you will not be required to turn over any financial records to the professional, nor will you have any other records given to outside third parties.
Credit consolidation is a step between out-of-control spending and bankruptcy that has given many people options that they otherwise would not have had. Credit consolidation attempts to find a third-party creditor that will help to alleviate some of the debt that has accumulated over a period of time. Credit consolidation is usually only an option if there is more than $10,000 worth of debt and no viable, immediate income stream that can be directed towards paying off that debt.
Credit consolidation is also very helpful when there is an unexpected emergency in a household. Consolidation is useful for setting aside debt when there has been a death in the family, especially a breadwinner. Unexpected unemployment is also a reason to get debt consolidation services.
Some of the benefits of credit consolidation include lower monthly payments, a single bill rather than multiple payments to different companies and a barrier between the borrower and creditors that can alleviate some of the pressure that is usually involved with paying back a late account. Many creditors will also forgo late fees and other penalties if they see that a borrower is attempting to work with a credit consolidation company that is highly reputable. They are much more interested in getting some of their money back rather than overcharging fees and forcing the borrower into bankruptcy. Bankruptcy usually means that none of the money on account will be paid back, and the company must write the debt off as a total loss.
Depending on the individual situation of a borrower, there are many other ways that can be used to stop out-of-control spending. Some of these methods involve financial professionals; others are self employed methods of controlling a budget. Whatever methods are used, make sure that they are reputable and effective. There is no reason that any borrower should have to deal with the repercussions of out-of-control spending when there are so many ways to curb it before it becomes a huge problem.
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