Are you a ‘buy now and pay later’ person? If you are you probably have at least one credit card and possibly a store card as well.
The question is: do you control your credit cards or do they control you?
If it feels like your cards are calling the shots, you can’t get through the month without using them and the interest you are paying seems to swallow up most of your repayments, your cards are in control – not you.
Transfer your balances and pay 0% Two simple ways to regain controlThe good news is that there are two easy-to-implement ways of regaining control and keeping it. You can use these techniques in whatever way suits you. If you want to pay off your balance and cut your cards up, you can do that.
If you want to reduce your card balance more quickly, you can do that. Or, if you just want to reduce the amount of interest you pay on your credit or store card debt, but continue to run a balance more cheaply you can do that too.
The two techniques you need are very simple and you may have thought about doing them before, you may even have tried them and given up. But they work best when you keep at them. The first trick is to pay zero percent interest on your cards. The second trick is to run a monthly budget and use it to monitor and reduce your spending.
Pay no interest on new purchases with our credit card best buys Trick #1: Never pay interest on your credit cardsEven if you don’t want to cut your spending, aren’t interested in saving and don’t care about the size of your credit card bill, you will still be better off not paying interest on your card borrowings.
If you have an existing balance we recommend you transfer it to the
Virgin credit card which offers 0% interest for 15 months and charges a 2.98% balance transfer fee. Switching a balance of £3,000 from a card charging 16.9% to the NatWest card could save you £633 in interest over 15 months.
If you are about to book a holiday, or make a major one-off purchase or set of purchases, then get a credit card especially for the job. We recommend the
Sainsbury’s Bank Mastercard which charges 0% interest for 10 months on new purchases and has a low rate of 5.9% for the life of any balance transfer.
Switch to a low rate credit card today and save with less hassle Trick #2: Do a budget and it is easy to spend lessBudgeting is simple. Once you have done it you will be amazed you never did it before. If you find that the credit card comes out of your wallet or purse every time you are in a shop or bar then you are probably spending too much. You can’t cut your spending unless you know where the money goes each month.
At the bottom of this article is a sample budget sheet. You can either recreate it in an excel document, which will make the sums a lot easier, or you can print it off and fill it in by hand. You only need to add in a figure for each cost that is relevant to your life. Guess the figures you aren’t sure about for now and refine those numbers later.
Once you have filled in all of the relevant costs, add them all up and subtract the total from your monthly take-home pay. Are you overspending each month? If you use your credit card a lot then the answer is probably “Yes”. Even if you are not overspending, how much do you have left over each month?
Is it enough to add to your savings? You do have savings don’t you?
Cut the cost of your utility bills… switch providers to save Cut your spending and improve your lifeIf you have made it this far you are already improving your life by understanding what you need to spend each month, how much is available to you and how much you spend on stuff you don’t need to have. Read this supplementary article to
discover the five simplest ways to reduce your spending without becoming a hermit or social outcast.
Following the five supplementary tips above could save you as much as £320 a month, that’s £3,840 a year. Imagine cutting your credit card balance by £3,840 in a year. Alternatively, imagine the feeling of security you would get from having that money in a
savings account.
Don’t let your money slip through your fingers and into the pockets of shopkeepers and bankers. There’s no point going to work every day and having nothing to show for it at the end of the month. It is easy to keep some of your hard-earned back for yourself by taking control of your credit cards, your spending and your life.
