- Posted August 13, 2013 by
Life Without A Credit Cards
How to live without credit card?
We, like most people of our world, never saw a problem with having credit cards. Maybe you think and see that Credit cards may be wonderful tools that let consumers buy what they need. But credit card spending has gotten out of control for millions of people who buy more than they can afford. While the business world tries to tell people they need credit cards to survive, knowing how to live without a credit card can help you establish healthy spending habits while avoiding the pitfalls that often come with having a wallet full of plastic. A lot of people think that it’s impossible to live without a credit card
especially these days when there’s just too much you need to buy and even more you want to own. But this article entitled how to live without a credit card will prove to you that owning one is not necessarily a need. In fact, you will be able to live without it and save even more money when you do. This is common and very big problem for today's population, while in many country rate of interest for using recourses of credit card reaches to double interest rates.
Main arguments for all credit card users is that through credit card, they can cover their unexpected fees as ever it will appear in their life, but nobody thinks that this look likes one day life action with future long term debt. Overcoming that fear can be difficult, especially if you have relied on credit cards your entire life as your safety net. Operating in a world without credit cards can be daunting, but if you have a plan and know what to expect, it is an easier transition than you would think.In this report i want to show best outcome from the critical situation where you can to push easly through credit cards.
1) Budget, Budget and Budget again: this is your greatest tool in living without credit cards for two reasons. First - you need to budget enough money to pay off your current
credit card debt and the sooner better. A good way to get ahead of your debt is to apply for a balance transfer credit card.Second - ou should set enough money aside
each month to create a savings account for any emergency spending, like for home repair or unexpected medical bills.
2) Make sure you have other types of credit: If you do plan on canceling your credit cards, you should keep a diversified credit portfolio full of other types of credit, such as mortgages, auto loans, student loans, etc. While not having credit cards will decrease your available credit, which could hurt your credit score, having these other types of credit will help balance out your credit score and show the credit bureaus that you still know how to utilize the debt you have.
3) Try a secured credit card: If your score does take a hit after cancelling your cards, or you want to prevent that from happening altogether, try getting a secured credit card. Since secured cards have lower limits -- $250 to $500, usually – and the cards report to the credit bureaus, they are good option for people who don’t want to accrue debt but still need a credit card to improve their credit score.
4) Keep track of your credit score: Living without credit cards may be damaging to your credit score, which may make it difficult to get loans or a mortgage. As your good credit ages out of your credit report, your score will drop, so keeping a close eye on your credit score can alert you to when you need to start rebuilding your credit with other types of loans.
5) Start a Christmas fund or a savings account for large ticket items, gift purchases and family vacations. Set money aside every month or out of every paycheck to an account
you've established for that purpose so when holidays come around or you want to take a trip, you have money set aside to buy what you need rather than relying on a
Here is how to start your journey of living without credit cards:
A) Having credit cards is helpful when you run into financial emergencies like costly medical bills. It is best to have an emergency fund tucked away so that if any emergency happens, you won't be stuck without a way to pay for them.
B) Keep a track of your credits. The one common thing that most of us do when we want to get rid of our credit cards is to cut them into two parts. This is one of the biggest mistakes one can ever commit. If you run out of your saved money, you can always use
it in case of a 'required' emergency.
C) Living without a credit card is a tough life. It becomes tough especially when you are out shopping. If you happen to see a pretty dress or that pair of boots you were longing to own, don't hesitate to turn your head away. You can always own that pair of boots or the pretty dress when you have the means.
D) When you begin to live without a credit card, you will at times not be aware of the amount of money you are spending. The trick here is to carry only a small portion of money in your wallet. This will help you from not spending too much of your saved up money once you get rid of the credit card.
Many people believe the myth that they must have at least one credit card to establish a credit record. However, you are establishing a credit report and credit score in your name every time you make your home, car or student loan payment. Maybe today credit card is a best tool of fastest money, but this is a source and best supporter of your debt rising.
By Irakli Berdzenadze
CEO & Chairman at I.B. Capital Management Inc
Personal Financial and Investment Consultant
Global Partner of Bauhaus Capital Partners in UAE, Qatar, Kuwait and Turkey
Global Financial Partner of River Green Funds
Deputy Chairman of Supervisory Board at Gulf Arabia Corporation