an idea for not messing up credit cards--

[all_adream]

I haven't had a credit card in years, since I crashed and burned with them long ago (partway due to their errors and then extra charges based on that and me refusing to pay since it was robbery. They ultimately sued me, the dogs). I learned my lesson, and have been doing fine without one for a long time now. I just applied for one in order to improve my credit scores since we plan to buy a house, and was accepted for one that has a low credit limit, was free the first year and costs a little after the first year ($19.00, which might be worth it for me, and I could possibly even switch to one without a charge by then). I just want to use it and pay it off every month to keep getting better credit scores.

The best way I can think of is to (obviously) only use it like a debit card, only using it for amounts I have in the bank right then, and then me writing a check for it immediately and putting the check in the back of my checkbook or whatever, deducting it from the register right away, and then when the time comes for the bill to be paid, I'll have a check put aside ready for it and it won't be a surprise or hardship. In theory, I could write down the figures if I planned to use it for a few things per month, and then write the check for that total *but still deduct the amounts from the register the minute I use the card*. This seems like it would work, as I have been using debit cards successfully and without screwing up for years--and I would resent paying interest for a crappy hundred-dollar purchase, so I won't fall for that--

Comments

[jamethiel]

What I do with mine is keep it where I can't get to it. In my case, in the freezer in a block of water to prevent impulse buys. I then save up a certain amount, and then use it to buy and transfer the money for what I've bought to my card straight away. It's not an impulse buy--I've planned it, and I have to let the card defrost first (you can't speed up the process or you fry the card)

I can't use mine every month. If I do, I end up impulse buying, but if your willpower is better than mine, go for it. Just be careful

[all_adream]

My impulse control is superb now--I have 100% learned that a credit card isn't really money at all, but just a plastic thing that takes the place of a check or cash, you know? Back when I got in trouble with them, I had disabled a leg, uninsured, in martial arts class, lived alone and had to support myself while learning how to walk again in my mid-thirties. I was really aware that it was almost like a friend or helper in that case: live on the top floor of a building and can't walk and too beat to cook? Order a pizza: it's like someone taking care of you. These days, though, I KNOW completely that it's like...sugar or booze or something to some people, and that to me, there is no longer any attraction to the misuse of it (or even to sugar or booze, for that matter). I just want the rebuilding-credit aspect, and other than that, wouldn't even bother to get one--life has worked fine with checks and cash and a debit card for years now.

[kyrielle]

What I did in college was very similar, and worked well for me - I had a running ledger of credit card charges and counted that against my bank account, and didn't let it go over. (Okay, that's not true: I let it go over once, though by an amount I knew I could pay off the next month, involving the phrase "bald tires" and an Iowa winter. Safety trumped money in that case.)

[all_adream]

That sounds sensible and helpful to you, in that the option of a little space was there, but if not needed, it wasn't used. To me, it's like sometimes you have an extra twenty/hundred dollar bill or whatever in your wallet, and usually ignore or forget about it, but if it's needed, it can be superhelpful if not abused when not needed--

[sapote]

Is there a recurring fixed cost you can use it for, like a cell phone bill, so that you could plan it into your monthly bill paying? I've noticed that the trick for me is to not feel like I have the option of making unplanned small purchases on my credit card at all because of how quickly (my budget being fairly tight) unplanned small purchases add up. I know someone who was very successful in building a credit rating by doing all of his utilities by credit card and then setting up automatic deductions from his paycheck to go directly to that balance, but I don't know if you have that option where you bank.

[all_adream]

I think I'll use it for things more like buying food, which can vary in cost but has to happen, and just be aware of the amount. My control is really good lately, after going broke in the past!!!!

[twospots]

What country are you in? Do you have access to online banking? Because, I admit, all this talk of using cheques and balancing sounds archaic to me! (Perhaps especially because I was just going through some of my mom's old stuff, and found a debit card that expired in 1978!).

Anyway, this may not be useful to you, but here is my system:

My credit card is from the same bank as my main bank account. I use my debit card for most purchases, and my credit card (mostly) for a few things where it's easier, like getting gas (paying at the pump takes about a quarter of the time if I use credit). I also have a few regular expenses (like charity donations) through my credit card, since my credit card has more protection than preauthorized debit.

When I want to pay off my credit card, I go online, view the balances of bank account & credit card, and transfer the money. It disappears immediately from my bank account, and shows up on my credit card within two business days, or something like that. In practice I do this about once every week or two.

I could do this even if I didn't have my credit card with my bank -- I'd just have to set up my credit card as a bill to pay, save my receipt, and then pay online when I got home. I'd see the money gone immediately from my bank account, and see the payment when I got my credit card statement (either in the mail, or, increasingly, online, as most of my bills now cost in the range of $2/month to receive in the mail).

Anyway, none of this will be helpful if you can't use online banking, but if you can, it might be an easier way to track your credit card.

[scheherezhad]

This is pretty much exactly how I handle my credit card. Online banking rocks.

[all_adream]

Nah, i live in the US, and INTENTIONALLY use checks and things instead of automatic payment, for everything except mortgage. The biggest reason is that I had an accident a few years back that gave me some mild brain damage, and doing math with paper and pencil is not only helpful to my brain, but it makes me feel very reassured that I really know what money I have. Additionally, there are all those researches that talk about how easy it is to spend when you use something other than cash, since it doesn't register in most minds as 'as real'. I am happy to write out my three or five checks a month for utilities and related stuff, and that keeps me aware of the total of all that I spend.

[vihm]

I use a debit card for most things, but what I'm thinking about doing is getting one of those gas-station-specific credit cards, and just using the card for that.