Break Yourself Free From Credit Card Bondage

Break Yourself Free From Credit Card Bondage

•  3 minute read

These four steps will help you break up with your credit cards and start your new financial future.

I used to be addicted to credit cards.

Break Yourself Free From Credit Card Bondage

They gave me a sense of financial security — a false one, as it turned out. Once, my outstanding balances reached a point that I could no longer afford to make the monthly payments.

 

I was forced to make payment arrangements with my creditors. If I defaulted on the agreement, the accounts would immediately be sent over to collections. The pressure was on!

 

WITH NO OTHER OPTION, I HAD TO ABRUPTLY END MY LOVE AFFAIR WITH MY MOST PRIZED POSSESSIONS.

 

If you’re in the same boat and desperately need to break up with your credit cards, here’s what to do:

 

1. Face the facts.

 

Do you understand why you got into debt in the first place? Did you engage in ‘retail therapy’ to cope with a stressful time in your life?

 

Perhaps, you were laid off and instead of scaling back, you relied on credit cards to support your lifestyle? Or, maybe, you used to be the family ATM or financial lifeline, and they never felt the need to pay you back in a timely manner?

 

If you miss this critical first step, you may never get out of the hole. And if you do, chances are history will repeat itself.

 

2. Crunch the numbers.

 

When was the last time you took a moment to crunch the numbers and see how much credit card debt you’re in? If the answer is never, like it was for me when I reached my breaking point, take a moment to add up all your outstanding balances to see where you stand.

 

This, my friend, is the easy part.

 

Next, I want you to use an online credit card calculator. You can determine how long you will be buried in credit card debt and the total amount you’ll pay back if you only make the minimum payment. (These figures will only get worse as you continue to use your credit cards).

 

This is when the lightbulb went off in my head. My monthly payments were only touching one percent of the principal and everything else was applied to interest.

 

Turns out that $1,500 vacation, the $500 purse, and $100 dinner were all way more expensive than the listed price.

 

3. Assess the financial impact.

 

Now you have these numbers at your disposal. Next, list all the financial goals you could accomplish if you weren’t making monthly credit card payments. Perhaps that week-long vacation wouldn’t be so far out of reach? Maybe, you could save for a down payment on your first home in record time?

 

Not only should these thoughts encourage you to place your cards in the nearest shredder as soon as possible, but they should also motivate you to accelerate your credit card debt repayment efforts.

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4. Make your credit cards vanish.

 

The conventional advice I initially received to break the addiction didn’t quite work out for me and it may not be working for you, either. Wondering why? Well, you have to go through the steps mentioned above to really get an understanding of how the credit card debt is impacting you. Once you’ve done so, you’ll be more inclined to make the cards disappear.

 

Otherwise, you’ll find yourself ordering replacements for the cards you sliced and diced, running hot water over the cards you froze in a block of ice, or frantically digging up a hole in the backyard to retrieve the cards you buried and vowed to forget about.

 

A Final Thought

 

It took several years to acclimate to without credit cards, but I’m finally out of the hole.

 

Through this painful but valuable lesson, I’ve learned it’s the consumer that creates the problem; not the card itself.

 

If you can’t responsibly manage your credit card debt and keep the balances low, it’s best to stay away from credit cards altogether. These days, I rarely use credit cards and when I do, I always pay off the balance promptly to prevent history from repeating itself.

 

Credit card addictions are hard to break, but you have to start somewhere. So, what are you waiting for? If I can break the chains of credit card bondage, I’m confident you can do the same.