Use Cash to Avoid Credit Card Debt

If you've gotten into the habit of using your credit card for weekly expenditures, it might be wise to think about using cash instead. Using plastic cards doesn't seem like you're spending “real” money. There's something quite unique and tangible about spending greenbacks that serves as a reminder you you're spending hard-earned cash.

Consider re-training yourself to avoid using credit cards for everyday expenditures. If you plan the amount you'll spend throughout the week, you'll keep a better handle on your funds.

Try the following method to keep a close watch on your weekly spending:

1.     Determine your weekly expenses. Add in money for fuel, eating out, entertainment and so on. If you buy coffee or beverages during your week, don't forget to allow funds for those extras. Come up with a figure that you believe covers your weekly expenditures. Don't include house rent/mortgage or any home-related bills you pay by check or online.

1.

Here's a simplified sample list of common weekly expenses:  

Fuel	$65.00
3 Lunches	$30.00
1 Dinner Out	$60.00
5 Beverages	$25.00
1 Movie Night	$20.00
Total Weekly Expenses	$200.00

·       The goal is to have enough cash to live day-to-day until your next payday. Rather than reaching for your credit card to cover recurring expenses throughout your week, spend your cash. Using this example, your weekly cash amount for expenditures is $200.00. Assuming you get paid weekly, reserve the $200.00 cash to keep with you for your weekly expenses.

Estimating and totaling the amount of money you spend in an average week is a good exercise because it sheds some light about how much money you're spending. The next step is to only use cash for your everyday expenses to avoid overwhelming credit card debt.

Spending cash helps trim credit card balances and fees over time, which is money in your pocket. If you practice these steps, you'll be spending less of your hard-earned cash on everyday expenditures throughout your week, leaving you more money for what you really want!