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Managing Your Debt

Urge to Splurge? Put that Credit Card Away!

You might think that a trustee in bankruptcy would be anti-credit card. Not true! We wholly believe credit cards are a fact of life in the modern world. In fact, if done wisely and using the right card, you can actually save money through the smart use of credit cards.

However, today we’re not talking about the smart use of credit cards to take advantage cash-back offers or loyalty rewards you actually use. We’re talking about the dangers of using credit for unplanned purchases.

Put it off until tomorrow

When you’re finding your way out of debt, learning to stick to a budget is arguably the hardest part. We are surrounded by new items in the stores, creating the temptation to buy. Instead of telling yourself you’re never going to buy anything new ever again, try implementing a cooling off period.

When you see an item you’re pretty sure you must have RIGHT NOW, give it 72 hours. Once you have had some time to consider a want for something new against the need to get out of debt, you may decide you can live without it after all.

Find out how much that item will REALLY cost

Let’s say you want to make a major purchase, like a new television. The one you want usually retails for $800, but it’s on sale for $700. You can’t really afford a new TV right now, but $100 is a lot of money. You should probably take advantage of the savings and use your credit card or apply for store credit, right?


If you make the minimum payment on a card with an 18.9% interest rate, that $700 TV will cost over $1000, and it will take nearly five years to pay off the balance! Hmm… It doesn’t look like such a good deal anymore, does it?

Reward the small sacrifices

When you’ve had a monumental shift in your attitude towards money, it’s important to celebrate small victories. If you resisted the temptation to buy on impulse, choosing to save up to buy it outright instead, give yourself a reward. Watch a guilty pleasure on Netflix and cook your favourite meal for dinner. You’ve earned it!

Need more tips to get your spending under control? Give us a call – we can help!

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