Most people would love to be free of any debt, but for most of us we at least have to trade off certain things to be that way. You would have to rent for the rest of your life, avoiding the burden of a mortgage, and you wouldn't have a credit card or short term loans like guarantor loans or provident loans to rely on for the times you're waiting for wages to come in. However, it is possible if you are willing to do a bit of planning and research. After all, your credit card can get you out of sticky situations but, wouldn't you rather not need it? Perhaps you have never believed that it could be possible to live without it, or you need encouragement to cut the card. Hopefully, these tips will help you feel confident you can survive without your credit card:
Have Your Own Emergency Savings
A lot of people have a credit card for emergencies, like if the washing machine breaks or the MOT costs more than expected. If you ditch the credit card, you can use the money you would have paid to use it, to start building your own savings account. It might be a risk not having the credit to rely on, but if you commit to saving up, you'll have a healthy emergency fund debt free.
Make Financial Goals
Without debt, saving for financial goals is of course, much easier. So just like your emergency savings, once you don't have the credit card you can then build on the emergency savings to save up for other financial goals like a holiday, car, new extension on your home, or even to buy a home outright.
Start Using Your Debit Card
You are probably used to using your credit card all the time, which is a bad habit you can crack by cutting your credit card up and using your debit card instead. This will get you used to dipping directly into the funds you have, which should make you think twice about any purchase you make.
If you are in debt with one credit card, or several, before you can follow any of the above tips you will need to pay off or consolidate your debts. If you have savings you should pay off debt with your savings because in the long term, you will lose more in the charges for the debt than you will make from interest on savings. If you don't have any savings to pay off debt, you need to cut up the credit cards and look to consolidate the debts accrued. National Debtline is a great, free charity to call if you need advice on what to do next. They will talk you through your options and send information out to you if you need it. Remember, you can live without credit cards and once you are free of debt and surviving on your own, you're going to feel fantastic.
