Credit cards and store credit seem perfect in the moment but six; seven, eight months down the line when you’re trying to pay everything off quickly so you can focus your money elsewhere, i.e Christmas, they become a pain in the arse.
Paying credit off can be easy to achieve even on a low-income. However, you need to be strict with yourself and change your lifestyle.
I personally LOVE saving money throughout the year as it relieves my anxiety, so these sacrifices come without burden. I fully understand that this may not be the case for everyone, but these tips could help you along your way.
- Set up a standing order to go out 5 days before you’re payment due date. This helps you to avoid any late charges due to weekends and bank holidays, as it takes 3 working days to update most company accounts.
- The moment you get your pay cheque put at least 5-10% off it away in a piggy bank and try not to touch it. It may seem like a lot when you have nothing, but it gets you in the habit of saving even if you have to use it.
- Every month write down a budget and stick to it.
- Work with cash. Take out your shopping, travel, personal and food money out in cash as you’ll be less likely to spend money when you can see it.
- Any money you have left at the end of the month, whether its £10 or £100 put towards your credit cards. This way your chipping away more than just the interest.
- Balance transfer if you have too and get rid of your interest.
- Don’t forget about it, its not going away!
For example, if I bring home after tax £1500 my budget would look something like this:
Savings: £150 (I renamed this to my ‘Oh Shit Account’)
House Bills: £750 (based on the average UK price found here)
Food: £100 pp
Mobile Phones: £50
Travel: £60 (based on two tanks of petrol, or one monthly bus pass)
Personal: £40 (£10 a week for Misc)
That leaves you with £318 to put towards your credit card. Within six months this £318 becomes £1,908 and within a year it becomes £3,816. Not to mention you would have saved £1,800 to do what you bloody well like with.