Are You Using Your Credit Card to Pay for Essentials?
Inflation and credit cards
The inflation has forced millions to use their credit cards to pay for essentials like bills and food. While credit cards are made to buy in advance, not everyone is able to pay back the credit card in time, which is when the interest accumulation become the worst nightmare.
In UK, we're lucky to have some good resources to help us make better financial decisions, thankfully. All we need is to find them. I dug into that and found a very good helpful resource I would like share with everyone. It is from Money Helper.
Money Helper super budgeting resource
There are 3 steps to get to the solution;
First step; know where your money is going. Trust me, when you think about it, the little £5 here and £3 there make a difference! So get your spending listed. What do you spend your money on every month. It is not about the one time purchase, it is about the bills, fuel, food, household, pocket money, etc... Things you regularly buy.
Step two; is prioritise what you owe (credits, bills, rent, mortgage...) then budget your spending. That's when it gets tricky, when you question yourself how much money to keep for food or fuel. Look at your previous months to find the pattern in your spending, if you have a routine, you will find the pattern.
Step three; now you have the numbers in front of you, it is time to decide where you can cut your expenses on. This doesn't mean you eat less, but maybe go less times to the pub, or less trips using your car when you can walk nearby. However, changing habits is not easy, what you should do, is change a very little thing at a time. For example, if you go to the pub 5 times a week, start going 4 times a week. Or if you buy 6 drinks, start buying 5 instead. Have more cash flow in your hand rather using your credit card.
If you want to understand how to prioritise your bills, try Money Helper Bill prioritiser which can help you put your bills and payments in the right order. If you’re struggling to pay – whether it’s your rent, your mobile phone bill or loan repayments – it will tell you in two easy steps what to do before you miss a payment.
let me explain; what you need to do is choose what bill worries you and you will receive further help with how to deal with it. Let's take the Council Tax as an example. They tell you what your options are and who you should contact. If you choose multiple bills, they tell you who to pay first and how to go about the others. Pretty useful guide with loads of links.
Remember, no one can help you unless you help yourself. If you are in large credit card debts, you know you need to pay it off to stop the high interest on it. Check the difference between the interest rates, think about taking out a loan from your local credit union with low interest, they will help you out. Credit Unions are the best alternative to any debt solution you get yourself in. It is a free service, low interest and help you save money on top of it as well. clevr.money helps people within Lancashire. If you live or work within Lancashire, then we might be your credit union. Check out our common bond areas.