Cash on Hand

Counting out cash to pay for purchases may seem so last century, but it is an excellent method of controlling your expenses and can help you stop getting in deeper with the credit card companies.

Credit cards are not your friends. Neither are the companies that issue them. Yes, they are convenient, or at least they seem that way. They make for a quick checkout, a quick trip to the gas station, and a quick way to go into debt. But you don’t need to be told that. You already know the pitfalls of plastic. You are living proof that credit cards are a trap waiting to ensnare unsuspecting souls who think they can use them wisely. After years of living on credit, you find yourself maxed out and barely able to make the minimum payments.

Living on a cash basis means buying only what you can afford to pay for at the moment. That means no loans, no plastic, no giving into impulses, and no more extended payment plans. If you don’t have the cash, you don’t make the purchase. Simple in concept, not so simple in practice. Making the change will take motivation, commitment, and yes, some sacrifice.

• Begin with a budget. Prioritize your expenses, with the most important items at the top of your budget.
• Pay your bills first, using online payments deducted from your bank account, by check, debit card or cash if possible.
• Withdraw cash from your account for things like groceries, gas, parking, bus fare, etc. Determine how much money you need for each expense and stick to it. When the money is gone you are done spending. It may be helpful to put money into separate envelopes labeled for specific expenses.
• Leave the rest of your money in a bank account. Withdraw cash as needed to pay for additional expenses throughout the month instead of paying by check or debit card. It is far too easy to overspend with these conveniences. Going to the bank, making withdrawals and counting out cash for purchases will make you think before you spend your hard earned money, and help keep your personal finances under control.
• Deposit a portion of your income each pay period into an emergency fund savings account. When something comes up, you will have the cash on hand and you can keep the credit cards put away.

Getting your spending under control is one of the most important steps to getting out of debt. Living on a cash basis will help you reduce the amount of money you spend, keep you from getting further into debt and free up money to pay off your credit cards faster.

Related Articles:

You Can Pay Off Your Credit Card Debt

How to Pay Off Credit Card Debt Fast without Debt Settlement or Consolidation