I never use my credit card. I don’t even know the PIN number. I got it for emergencies years ago and the only time I used it was when I lost my debit card. The thoughts of using it and forgetting to pay a bill or getting charged high interest scares the bejesus out of me.
But it seems I am in the minority. In December 2017, Irish people spent €985 million on their credit cards according to the Central Bank, This was up 2 per cent on the same month in 2016. It is nearly five months later – how many of us are still paying off Christmas presents that are long forgotten?
It is time to take that little card of debt out of your life. Between student loans, mortgages, car loans and so on, most people have enough debt without casually adding on more with an easy swipe.
Every time you carry a balance over from one month to the next you face paying more interest. You end up with no money to buy essentials and so you use your credit card again to fill that void. It is a vicious cycle and now is the time to break that cycle.
The first all important step is to take your credit out of your wallet and leave it somewhere safe but out of easy reach. If you know your credit card number off by heart then cancel it and get a new one. Then put the new one somewhere far, far away.
Make sure to visit the websites of your favourite online retailers (hello ASOS) and delete your credit card information from them to avoid adding to the total debt you need to pay down.
Then figure out how much you owe on your credit card or credit cards. Use the Competition and Consumer Protection Commission’s online calculator to figure out how long it will take you to pay off your credit card debt at the current rate and whether it is worth your while switching to a different credit card provider to reduce your interest rate while you are paying it off.
If you have more than one credit card, always pay the minimum payment at least on each card. Then focus on clearing your debt on one card at a time to make things a little bit more manageable. It might seem like a mountain of debt to clear but if you stick with it, bit by bit you’ll get there and you too can enjoy a smug, credit card bill free life.